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Forma's 2025 Lifestyle Spending Accounts Benchmark Report

Forma, the flexible benefits platform revolutionizing employee spending accounts, has published its much-anticipated 2025 Lifestyle Spending Accounts (LSAs) benchmark report. This marks the third consecutive year that Forma has provided insights into this crucial aspect of employee benefits, and the findings are more interesting than ever.

As companies strive to meet diverse employee needs, the report sheds light on profound trends that indicate how organizations are designing and administering LSAs. Notably, dedicated accounts for specific categories have seen remarkable growth, outpacing the traditional All-inclusive LSAs for the first time. For instance, expenditures in areas like Commuter Assistance, Caregiving, and Family Formation surged over 50% year-over-year, contrasting sharply with a more modest 23% rise for All-inclusive LSAs. This shift signifies an essential change in corporate attitudes toward employee benefits, aiming for customization instead of a one-size-fits-all approach.

Key Insights from the 2025 Report

1. Growth of Specialized Accounts
The shift toward dedicated spending accounts highlights an increasing awareness among employers that support for employees must cater to their particular circumstances. Jason Fan, CEO of Forma, stated, “Today's employers understand that benefits can no longer be one-size-fits-all.” As companies become more intentional in their benefits offerings, they are better equipped to address the evolving priorities of their workforce.

2. Consolidation for Efficiency
A noteworthy finding is that many employers are consolidating their benefits platforms, with 54% managing two or more LSAs on a single platform. Moreover, 62% are also managing multiple pre-tax programs concurrently on a unified platform. This trend not only suggests a move toward simplicity but also reflects a strategic decision to drive operational efficiency.

3. Increased Funding Despite Economic Caution
Interestingly, even in light of economic uncertainty, LSA funding saw a notable increase in 2024. This included crucial areas such as 'Belonging & Connection' and 'Medical Travel', indicating companies' dedication to fostering workplace connectivity and meeting critical employee needs.

4. Essential Spending Patterns
The report also observed that employees are channeling their LSA funds toward essential services like caregiving and skills development, demonstrating the financial aspect of wellness initiatives within the workplace. By prioritizing these categories, employees highlight their focus on personal well-being and growth.

5. Expanding Across Industries
While LSAs were initially popular primarily in the tech sector, the report reveals a growing trend with 59% of companies offering LSAs now belonging to industries outside of technology. This indicates that the concept of customizable benefits is resonating across the business landscape, as organizations recognize the value of tailored income support.

As workplace norms continue to evolve, the findings from Forma's benchmark report underscore that LSAs are not just a trend, but rather a strategic tool for enhancing employee satisfaction and well-being. Employers are realizing the importance of aligning benefits with their workers’ unique needs and preferences, creating more impactful workplace environments.

To access the full 2025 LSA benchmark report, you can visit Forma's official website.

About Forma

Forma is at the forefront of flexible benefits management, enabling organizations to empower their employees through customized choices reflecting individual needs. By integrating LSAs, pre-tax accounts, and HRAs, Forma is reshaping the future of employee benefits, promoting both engagement and simplicity in administrative processes. Its innovative approach and commitment to enhancing workplace well-being have made it a trusted partner for organizations worldwide.