Lifestyle Spending Accounts (LSAs) are employer-funded accounts that give employees the freedom to choose how to spend their LSA funds. LSAs support a diverse workforce by covering a variety of eligible expenses to fuel employees’ physical, emotional, and financial well-being. These flexible benefits programs are a game-changer for employee health and happiness.

Your people are your most valuable asset. By offering benefits that cater to different aspects of employee well-being, you can create a more positive and supportive work environment for all.

In this article, we’ll explore what is covered under a Lifestyle Spending Account and which expenses can unlock the full potential of LSAs for your employees and your organization.

Here’s what we’ll cover:

Move beyond the expected with the ultimate employee benefit aligned with your company values. LSAs enable employers to choose which expenses support employees’ unique needs and lifestyles. Each organization determines program parameters, eligibility rules, and ineligible expenses.

What are eligible expenses for Lifestyle Spending Accounts?

Eligible expenses for Lifestyle Spending Accounts may include gym memberships, wellness programs, mental health services, childcare costs, and more. Employees can choose how to best use their LSA funds to support their overall well-being.

An eligible LSA expense will most commonly fall into one of these five lifestyle spending categories: 

Move beyond the expected with the ultimate employee benefit aligned with your company values. LSAs enable employers to choose which expenses support employees’ unique needs and lifestyles. Each organization determines program parameters, eligibility rules, and ineligible expenses.

Lifestyle Spending Account Eligible Expenses for the top five categories: physical health, emotional and mental health, family support, financial services, and career development.

Physical health and fitness

Offer employees benefits beyond health insurance to support whole-body health and physical fitness. From gym memberships and fitness classes like yoga or Zumba to personalized training sessions or exercise equipment, LSAs empower employees to find activities that fit their lifestyle.

Some examples of LSA-eligible expenses related to physical fitness include:

  • Gym memberships
  • Fitness classes
  • Massage therapy
  • Exercise equipment
  • Nutritional supplements
  • Home office equipment
  • Sport league fees

Emotional and mental wellbeing

Total well-being goes beyond physical health. Lifestyle Spending Accounts offer a wellness program and resources that support employees’ emotional and mental health. Equip employees with healthy coping strategies and tools to navigate life’s demands and stave off burnout. 

LSAs also celebrate the powerful connection between creative outlets and mental health. When people get to do things they love, like dance, painting, woodworking, and gardening, they’re not just having fun – they’re reducing stress, fostering a sense of accomplishment, and giving their mental health a major boost!

Typically covered expenses for emotional and mental health include:

  • Mental health support
  • Spa services
  • Mindfulness apps (like Headspace)
  • Meditation classes
  • Stress management workshops
  • Resilience training
  • Emotional wellness activities (gardening, painting)

Family support 

LSAs support employees’ whole crew by providing benefits for parenthood, elder care, pet care, and home purchase expenses. This includes covering travel expenses for personal care, family-forming benefits like adoption funds, fertility treatments, and surrogacy support, and childcare services. Customizable lifestyle benefits contribute to a balanced and fulfilling life for employees outside of work.

Eligible expenses related to family and lifestyle support:

  • Supplemental childcare cost
  • Eldercare
  • After-school programs and babysitting services
  • In-home nursing costs
  • Assisted living support
  • Medical travel benefits
  • Groceries and meal stipends
  • Pet care
  • Home purchase expense reimbursement
  • Charitable donations

Financial health

Lifestyle Spending Accounts fund resources to support financial health and well-being and empower employees to take control of their financial future. Access to financial services helps employees develop a personalized plan for managing money, saving for retirement, and achieving their financial goals.

LSA-eligible expenses related to financial services ensure employees have a roadmap for financial security by helping them tackle debt, prepare taxes, pay off student loans, and more.

Eligible expenses may include:

  • Financial planning and advisor services
  • Identity theft protection
  • Financial seminars
  • Student loan reimbursement
  • Tax preparation
  • Commuter benefits
  • Credit monitoring

Career development and enrichment

LSAs also offer employees the opportunity to use allowed funds for a wide range of eligible expenses related to their professional development. Employees can invest in educational opportunities, certifications, and licenses to enhance their professional skills and stay competitive in their careers. 

Beyond job-specific skills, LSA-eligible expenses can support personal growth and enrichment, too.

Qualified expenses for development and enrichment may include:

  • Fees, books, and learning materials
  • Professional development workshops and courses
  • Executive coaching
  • Language learning
  • Life coaching

While the categories above remain consistently popular, 2025 is bringing new priorities and approaches to how LSAs are used. Here’s what’s trending this year:

1. Personalization leads the way

Personalization has emerged as the #1 driver of LSA adoption, surpassing even talent attraction. Employees want benefits tailored to their life stages–from student loan repayment and financial coaching to caregiving and pet support.

2. Consolidation over complexity

There’s a significant push to consolidate stipends, allowances, and point solutions into centralized LSAs. Employers are streamlining benefits to reduce admin burden while still offering flexibility and choice.

3. Modest budgets, major engagement

Even with rising healthcare costs, funding as low as $500/year per employee has achieved 80%+ participation rates. Employers are learning that impact doesn’t always require high spending, just thoughtful design.

4. Remote work and productivity support

LSAs now frequently cover home office setups, co-working spaces, tech tools, and internet subsidies—a nod to hybrid work becoming the norm.

5. Mental and financial wellness rising

Spending on mental health (apps, therapy, coaching) and financial wellbeing (planning, tax services) is steadily growing. Employees are choosing benefits that reduce stress and build long-term security.

6. Specialty allowances and lifetime categories

Companies are increasingly offering specialty allowances—such as education, fertility, or eldercare—that allow long-term planning and deeper support over time.

7. Global consistency with local relevance

For global employers, LSAs are being used to standardize benefits across countries while offering localized choices, ensuring equity and compliance.

Leverage LSAs for happier, healthier employees

With a Lifestyle Spending Account, you can boost employee engagement and job satisfaction and encourage personal and professional development. LSAs help HR teams manage budgets, promote a positive company culture, and improve business outcomes. 

Discover how you can take your company’s benefits package to the next level with Espresa’s LSA platform. Reach out to our team for a free demo today!

How to Fund a Lifestyle Spending Account and Save Your Budget

Ryan Ramsey

Ryan is Espresa's Head of Strategic Alliances, based out of Colorado.

More by Ryan Ramsey
 

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