Pull up any job description right now. Somewhere between the responsibilities and the salary range, you’ll find a wellness wallet, a professional development stipend, or a home office allowance. Not buried at the bottom. Right there alongside 401(k) matching and parental leave.
That’s new. Not new as in last week, but new as in, it would have been unusual five years ago and is now completely unremarkable.
I know this because I hear it constantly. Fortune 500 CHROs tell me candidates come into interviews asking not whether their company offers stipends, but what kind, and how much. It’s become a standard line in offer negotiations, the same way people ask about 401(k) matching or parental leave a decade ago.
Fidelity’s own workplace consulting practice flagged that one-third (~30%) of employers were actively considering adding an LSA in 2025.
Here’s what’s even more telling: According to Sequoia’s 2025 Benefits Benchmarking Report, LSA adoption more than doubled in a single year — from 8% to 19% among midsize companies. Every company size saw growth, averaging 10% year over year.
Sequoia also projects that nearly half of fully in-office employers will offer an LSA by 2026.
That change has happened faster than almost any other evolution in compensation I’ve seen in 20 years as a CFO.
This isn’t a Silicon Valley thing anymore. At Compt, we see hospitals, manufacturers, nonprofits, and front-line employers — organizations that would have seemed unlikely candidates five years ago — now running these programs at scale.
The innovation phase is over. This is mainstream compensation.
Why stipends replaced perks as the default employee benefit
To understand where this is going, it helps to understand why it took off.
For a long time, employee perks were experiences. The beer tap. The ping pong table. The catered Friday lunch. I remember this phase well — I installed beer taps at one of the companies where I was CFO. It seemed like the obvious call. Visible, fun, the kind of thing that shows up in Glassdoor reviews. For a few months, it landed.
And then the requests started.
Cider for the gluten-free team members.
Wine for the people who didn’t like beer.
Something, anything, for the employee who was pregnant and felt increasingly excluded from every team event that somehow centered around the taps.
I had designed a perk for everyone based on what I thought most people would enjoy. I was right about most people. And I was completely wrong about the approach.
Remote and hybrid work accelerated the reckoning. You cannot build culture around an espresso machine when half your team hasn’t seen the office in two years. The perks that were supposed to signal investment became, for many employees, a reminder that the company’s investment didn’t actually reach them.
Stipends solved this cleanly: the company sets a budget, the employee decides what they need, and the benefit reaches everyone, regardless of where they live, what stage of life they’re in, or whether they ever set foot in a corporate office. The platform handles the day-to-day questions — what’s eligible, how to submit, when they’ll be reimbursed — so the benefit is clear and easy to use.
In any given payroll cycle, Compt might process a reimbursement for fertility treatment alongside one for an engagement ring, a security camera to monitor an aging parent, and a donation after a hurricane. All real purchases customers told us they made with their stipend. Each one tax-classified differently. Each one reaching an employee at exactly the moment they needed it.
That’s what modern benefits are supposed to do.
The infrastructure behind stipends was never built for them
Mainstream adoption created an infrastructure problem nobody has fully solved.
Every major compensation category eventually developed purpose-built infrastructure to support it — payroll systems for wages, benefits administration platforms for health insurance, retirement plan providers for 401(k)s. Stipends are following the same arc. Just faster.
The scale is already there. According to Compt’s 2026 Annual Lifestyle Benefits Benchmark Report, average stipend funding per employee was $850, despite economic headwinds. Employers are actively redirecting compensation dollars into stipends because it’s one of the few levers they have left.
A Head of Total Rewards at a midmarket HR software provider even told me recently, “An LSA was actually the only benefits enhancement that we recommended to our executive team for 2026.”
But the systems being used to administer that spend were built for something else entirely.
Expense platforms were designed for business costs.
Payroll was built for regular, recurring, predictable pay.
Neither maps cleanly onto something variable, categorical, individually driven, with tax implications that vary by use.
The result is that a significant and fast-growing line item in total compensation is being managed with spreadsheets, expense tools, and payroll workarounds that weren’t designed for it, with real consequences for compliance, visibility, your budget, and the employee experience that’s supposed to make the benefit feel relevant in the first place.
The market is already responding. Major enterprise players — Bank of America, Fidelity, HealthEquity, WEX — are building or acquiring stipend capabilities as part of their core offerings to complete their compensation infrastructure. None of them have fully solved it yet.
And there’s been a sharp increase in the number of stipend software solutions designed to make managing eligibility, tracking, and tax compliance simple while improving the employee experience. This is what we’re building at Compt.
The compensation layer that still needs to be built
When a compensation category adoption grows 10% in a single year across every company size, including in industries that were never early adopters, and the infrastructure to support it is still being assembled from tools built for other purposes, it creates a gap bigger than benefits administration alone.
It leaves a fundamental hole in the financial infrastructure behind how companies pay their people.
The organizations that build the right software product or new layer here won’t just be processing reimbursements.
They’ll own visibility into a growing share of total compensation: the utilization data, the category spend, the compliance trail, the employee experience that sits between “here’s your budget” and “here’s what it paid for.”
Stipends started in perks. They matured through benefits. They’re now moving into compensation — and the category is large enough, permanent enough, and complex enough that purpose-built solutions are going to matter.
The only question is who builds the definitive one. And I believe it’s Compt.
