by WEX Benefits
Employers are turning to Lifestyle Spending Accounts (LSAs) as an incentive for their current employees and as a recruiting tool for new employees. Why? Because experienced employees carry a wealth of knowledge, a variety of skills and a mature perspective in their roles. There’s considerable value in developing a successful retention strategy. One report even estimated that replacing a single employee, on average, costs you $15,000! So what can you do to retain your best and brightest employees?
And beyond recruitment and retention, there are plenty of additional benefits! You can design an LSA how you’d like, deciding how often funds are distributed into the account and what types of purchases are considered eligible.
Employees are also drawn to these accounts because, while their LSA funds are taxed, the account itself is funded by you, as the employer. Keep reading to learn more about how these accounts benefit employees and why you should consider adding them into your benefits offering mix. And listen to this episode of our Benefits Buzz podcast, where we take an in-depth look at the Lifestyle Spending Account.
Encourage healthy employee habits
Lifestyle spending accounts and employee wellness programs are trending, and it’s no surprise that’s happening at the same time! Though LSAs don’t have to be health-specific, they can be a part of an effective employee wellness program, which have shown returns on investment as high as 6-to-1. Wellness programs increase productivity, influence employee happiness and reduce healthcare claims (helping you and your employees save money). Your LSA can also be part of your overall wellness initiative if you choose for it to cover expenses such as:
- Gym memberships
- Athletic clothes
- Healthy recipe meal-kit services
Reduce financial stress
Stress is a common reason for decreased productivity at work. Nearly half of all employees say finances are their biggest stress trigger, and 47 percent say financial stress has led them to either miss work or has negatively impacted their productivity. To encourage your employees to develop better financial habits, offer a Lifestyle Spending Account that covers expenses for student loan repayment assistance or life emergencies (such as when their car breaks down or a home appliance breaks).
Promote leadership and learning opportunities
Your best employees are going to give 100 percent every day they’re at work. They care deeply about the success of your business, and it’s important you show them you care too. That can come in the form of development and training opportunities. For example, nearly 90 percent of millennials say that professional development and career growth opportunities are very important to them. Encourage your career-oriented employees by providing an LSA that covers the cost of conference tickets, professional development classes or motivational speaker events.