Forma Releases Third-Annual Lifestyle Spending Accounts (LSAs) Benchmark Report, Highlighting Unexpected Shifts in Flexible Benefits Program Design and Utilization
FREMONT, Calif., Feb. 4, 2025 /PRNewswire/ -- Forma, the flexible benefits platform that makes it easy for companies to customize and scale employee spending accounts, today announced the release of its 2025 Lifestyle Spending Accounts (LSAs) benchmark report. Now in its third year, this highly anticipated report reveals key trends and insights into how organizations are designing, funding, and administering LSAs, as well as how employees are utilizing these flexible benefits to support their well-being at work and in life.
Forma's 2025 Lifestyle Spending Accounts (LSAs) benchmark report found that while All-inclusive LSAs remain the most popular account type, the growth rate of dedicated accounts for categories such as Commuter Assistance, Caregiving, and Family Formation outpaced All-inclusive LSAs for the first time ever.
The findings in Forma's 2025 LSA benchmark report demonstrate several shifts for this employer-funded, customizable benefit type, with employers moving toward more intentional and targeted support to address evolving employee priorities.
Key findings from the report include:
The growth rate of dedicated accounts outpaced All-inclusive LSAs for the first time ever. While All-inclusive LSAs remain the most popular option, Forma's report found that dedicated spending accounts for categories such as Commuter Assistance, Caregiving, and Family Formation grew over 50% year-over-year, compared to 23% growth for All-inclusive LSAs.
More employers than ever are consolidating benefits platforms to drive efficiency. Many organizations are consolidating their benefits offerings, with 54% now managing two or more LSAs on a single platform and 62% now managing two or more pre-tax programs on a single platform.
Employers increased LSA funding intentionally despite a cautious economy. Despite uncertain economic conditions, LSA funding increased in 2024 for categories including Belonging & Connection and Medical Travel, reflecting a commitment to fostering workplace connectivity and addressing employees' critical needs.
Employees are using LSA funds for essential spending. In 2024, many employees spent their LSA funds on high-priority categories – such as caregiving, skills development, and tuition assistance, underscoring the role of LSAs in supporting financial health and essential needs.
LSAs gained traction across multiple industries. Once associated primarily with technology companies, Forma's research found that 59% of companies offering LSAs operate in industries outside of tech.
"Today's employers understand that benefits can no longer be one-size-fits-all, and our 2025 LSAs benchmark report showcases this exciting and strategic shift," said Jason Fan, Co-Founder and CEO of Forma. "Organizations are leveraging LSAs – and optimizing how they administer them – to deliver tailored, impactful benefits that meet employees' evolving priorities while driving efficiency and measurable ROI for employers. This report highlights that LSAs are evolving and sets the stage for the next era of customizable benefits innovation."
Forma provides a flexible benefits platform, helping employees choose benefits that matter most to their individual needs. By offering customizable Lifestyle Spending Accounts (LSAs), Pre-tax accounts, and HRAs across a unified benefits experience, Forma enables employers to deliver flexibility, drive engagement, and reduce administrative complexity. Trusted by leading organizations worldwide, Forma is redefining the future of employee benefits. For more information, visit www.joinforma.com.
SOURCE Forma
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