Employers are scrambling to build as the cost of living continues to exceed wages.
Lifestyle Savings Accounts (LSAs) are a series of funds in which employers provide employees with a full range of funds.
“This account allows employees to choose the type of spending that best suits their needs, and gives employers flexibility in determining benefit levels,” said WTW Senior Director of Employee Spending Accounts. says Sarah Taylor. “The flexibility and personalization of this benefit is very appealing.”
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Specifically, when WTW asked employers why they offer or are considering offering LSAs, more than two-thirds of respondents said it was to personalize benefits, and 59% said it was to personalize benefits. The answer is to attract and retain customers. Taylor points out that employers are increasingly overwhelmed by how many different benefits there are. It's especially difficult to help everyone in a generationally diverse workforce, she points out. Some employees need help with student loans, others need to fund long-term care, and older employees are typically looking to put more of their paychecks into retirement accounts. LSAs help employers consolidate the needs of multiple employees into one benefit package.
“Employers have added many benefit programs over the years, but historically some of those programs have been poorly utilized by the employee base,” Taylor says. “LSA has the potential to provide a richer experience for employees compared to a laundry list, where parts or parts of the program appeal to certain demographics but not completely. [workforce]. ”
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Taylor predicts that LSAs will become more common as employers seek to accommodate the diverse financial needs of their employees, but that doesn't mean they're foolproof. Taylor asked employers what benefits the LSA would replace and whether its consolidation would really help employers provide more funding for more of their employees' needs. I advise you to consider this first. From there, the employer should clarify the reason for offering her LSA and highlight how much the employee can take advantage of the new benefit at.
“I'm a big believer in communicating why we're doing this, what this is, and continuing to talk about it. It's not just a one-time thing,” Taylor says. “We need an ongoing campaign to remind people that they have this benefit.”
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What an LSA covers is entirely at the employer's discretion, so benefits managers must ensure that the LSA covers what employees most want. If an employee tries to use her LSA and suddenly realizes that her LSA doesn't cover their needs, it's going to leave a bad taste in their mouth, Taylor says.
“This is very difficult for employees. They want to know what they're getting out of this,” she says.
