Reference

Glossary — the American words nobody explains

Escrow. Copay. Routing number. Co-signer. 51 terms you will meet in your first year in the United States, defined in one or two plain sentences each — with a link to the guide that goes deeper.

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1099: A form reporting money paid to you as a contractor rather than an employee. Nothing was withheld, so you owe income tax and self-employment tax on it. Receiving a 1099 for work that looked like a normal job may mean you were misclassified.Full guide: Your first US tax return, explained
401(k): A retirement savings account offered through an employer. Money is taken from your pay before tax, and many employers add a matching contribution up to a limit. The match is part of your salary — not taking it is leaving money behind. You keep the account when you leave the job.

A

ACH transfer: The standard US bank-to-bank electronic transfer. Free or nearly free, usually settles in one to three business days. It is what direct deposit and most bill payments run on.
APR: Annual percentage rate — the yearly cost of borrowing, including interest and certain fees. On a credit card paid in full each month you never pay it. On a balance carried over, it is the number that matters most.
Authorized user: Someone added to another person's credit card account. Many card issuers report the account's full history to the authorized user's credit file, which can create years of history overnight — including the account holder's late payments.Full guide: Building a US credit score from zero — a realistic 12-month plan

B

Broker fee: A fee some rental markets charge for the agent who showed you the apartment, often one month's rent or a percentage of the annual rent. Common in a few large cities and unheard of in most of the country. Always ask before viewing.

C

Cashier's check: A check drawn on a bank's own funds rather than yours, bought at a branch. Landlords and car sellers often require one because it cannot bounce. Note that funding a money transfer with one now attracts the 1% federal remittance tax.Full guide: The cheapest way to send money home from the US in 2026
Co-signer: A person who signs a lease or loan alongside you and is legally liable if you do not pay. For a newcomer with no credit file, a US-based co-signer is usually the single strongest thing you can bring to a rental application.Full guide: Renting a US apartment with no credit history
Copay: A fixed amount you pay for a medical visit or prescription — say $30 to see a doctor — with the insurer covering the rest. Separate from, and usually in addition to, your deductible.
Credit bureau: One of the three national companies — Equifax, Experian and TransUnion — that collect records of how you handle borrowing. They do not share data with credit systems in other countries, which is why arriving in the US resets you to zero.
Credit freeze: A free lock you place on your credit file that stops anyone opening a new account in your name, including you, until you lift it. It is the single most effective protection against identity theft and takes minutes to set up at each bureau.
Credit utilization: The share of your available credit limit that is reported as used. Keeping it under about 30%, and ideally under 10%, is worth a meaningful number of points. It is calculated from the balance on your statement date, not the balance after you pay.Full guide: Building a US credit score from zero — a realistic 12-month plan

D

Deductible (insurance): The amount you pay yourself each year before the insurer starts paying. A $3,000 deductible means the first $3,000 of covered care is yours. Low premium usually means high deductible, and vice versa.
Direct deposit: Your employer paying wages straight into your bank account. Setting it up usually requires your routing number, account number and sometimes a voided check. Many banks waive monthly fees once direct deposit is running.
DMV: Department of Motor Vehicles — the state agency that issues driver's licenses and registers vehicles. Called the RMV, MVD, BMV or DDS depending on the state. There is no federal equivalent.Full guide: Getting a US driver's license as a newcomer

E

E-Verify: A federal system some employers use to confirm electronically that a new hire may work in the US. Employers enrolled in it need your Social Security number, which is one situation where a pending card genuinely delays payroll setup.
EAD: Employment Authorization Document — a card issued by US Citizenship and Immigration Services proving you may work. It is accepted as proof of identity and work authorization for a Social Security number, a driver's license and Form I-9.
Escrow: Money held by a neutral third party until conditions are met. Most often heard in home buying, where a deposit sits in escrow, and in mortgages, where the lender collects property tax and insurance monthly and pays them on your behalf.

F

FBAR: Report of Foreign Bank and Financial Accounts. If you are a US person for tax purposes and your foreign accounts together exceeded $10,000 at any point in the year, you must file it electronically with the Treasury — separately from your tax return.Full guide: Your first US tax return, explained
FICO score: The credit score most US lenders actually use, on a 300–850 scale. It needs at least one account open for around six months before it can produce a number at all. Other scores exist and may differ by dozens of points.Full guide: Building a US credit score from zero — a realistic 12-month plan

G

Grace period: The window between a credit card statement closing and the payment being due — usually around three weeks — during which no interest is charged if you pay the full balance. Carry a balance once and many cards suspend the grace period until you clear it.
Gross pay vs net pay: Gross is what you earn before deductions; net, or take-home, is what actually reaches your account. Rental income requirements are almost always quoted against gross. The gap is federal tax, state tax, Social Security, Medicare and any benefits.
Guarantor service: A company that guarantees your rent to a landlord for a fee, typically a percentage of the annual rent. Useful when you have nobody in the US to co-sign. Check the landlord accepts that specific company before paying.Full guide: Renting a US apartment with no credit history

H

HOA: Homeowners association — a body that manages shared parts of a condo building or housing development and charges a monthly fee. It can also impose rules on renting out, pets, noise and even the colour of your front door.
HSA / FSA: Tax-advantaged accounts for medical costs. An HSA pairs with a high-deductible health plan and the money is yours for life; an FSA is set up by your employer and usually must be spent within the plan year.

I

In-network: A doctor, hospital or lab that has a contract with your insurer. Out-of-network care can cost several times more, or not be covered at all. Always check network status before an appointment — including the anaesthetist, who is often billed separately.
ITIN: Individual Taxpayer Identification Number — a tax processing number from the IRS for people who must file or be claimed on a US return but cannot get a Social Security number. Applied for on Form W-7, normally attached to your first return.Full guide: Your first US tax return, explained

L

Lease: A rental contract for a fixed term, commonly twelve months, that neither side can end early without a penalty written into it. A month-to-month agreement is the flexible alternative, usually at a higher rent.

M

Money order: A prepaid paper payment bought at a post office, shop or bank, used where a personal check is not accepted. Like cash and cashier's checks, using one to fund an international transfer now attracts the 1% federal remittance tax.Full guide: The cheapest way to send money home from the US in 2026

N

Notary public: A person authorised to witness signatures and confirm identity. Many US documents require notarisation. Banks, shipping shops and libraries commonly offer it for a few dollars — you do not need a lawyer.

O

Open enrollment: The limited annual window in which you can choose or change health insurance. Outside it you generally cannot switch unless you have a qualifying life event such as a new job, a marriage or a birth.
Overdraft: Spending more than your balance. US banks may either decline the payment or allow it and charge a fee, often around $35 per transaction. Opting out of overdraft coverage on a new account is usually the safer choice.

P

Pay stub: The statement showing gross pay, each deduction and net pay for a pay period. Landlords and lenders ask for the two or three most recent ones, so download them rather than relying on your employer's portal being available later.
Peer-to-peer payment app: Services that move money instantly between US bank accounts. Convenient and effectively irreversible — a payment sent to the wrong person or to a scammer is usually gone for good, unlike a card payment.
Premium: The amount you pay each month to hold an insurance policy, whether or not you use it. Distinct from the deductible, the copay and the out-of-pocket maximum, all of which apply only when you actually receive care.

R

REAL ID: A federal standard for state identification. A compliant licence carries a star and can be used to board domestic flights and enter federal buildings; a standard licence still lets you drive. A valid passport does the same job.Full guide: Getting a US driver's license as a newcomer
Renters insurance: Cheap cover — often $10 to $20 a month — for your belongings and for liability if you damage the building. Many US landlords now require it as a condition of the lease. The landlord's policy covers the building, never your possessions.
Routing number: A nine-digit code identifying your bank, used with your account number for direct deposit and transfers. It is printed at the bottom left of a check. Not a secret, but not something to post publicly either.

S

Secured credit card: A credit card backed by a refundable deposit you place with the issuer, usually equal to your credit limit. It reports to the bureaus exactly like an ordinary card, which makes it the most reliable way to start a US credit file.Full guide: Building a US credit score from zero — a realistic 12-month plan
Security deposit: Money held by a landlord against damage and unpaid rent, returned when you move out. Many states cap the amount and set a deadline for returning it. Photograph everything on move-in day — deposit disputes are won with dated evidence.Full guide: Renting a US apartment with no credit history
SSN: Social Security number — a permanent nine-digit identifier issued by the Social Security Administration. Originally for recording earnings towards retirement benefits; now the key to payroll, banking, credit and most state IDs.Full guide: How to get a Social Security number as a new arrival in the US
SSN denial letter: A formal letter from the Social Security Administration confirming you are not eligible for a number. Most states require it before issuing a driver's license to someone without an SSN. You request it in person at an SSA office.Full guide: Getting a US driver's license as a newcomer
Standard deduction: A flat amount residents can subtract from income before tax is calculated — $15,750 single for tax year 2025, rising to $16,100 for 2026. Non-resident aliens generally cannot claim it, which is why residency status matters so much.Full guide: Your first US tax return, explained
Sublet: Renting from an existing tenant rather than the owner. Often the easiest first home for a newcomer because screening is informal — but check the original lease permits it, or you can both be evicted.
Substantial presence test: The IRS day-counting test that decides whether you are a resident or non-resident for tax purposes: 31 days this year and 183 counting all of this year, a third of last year and a sixth of the year before.Full guide: Your first US tax return, explained

U

Utilities: Electricity, gas, water, rubbish collection and internet. In the US these are frequently not included in rent and must be set up in your own name — which is also how you produce the address documents the DMV wants.

V

Voided check: A blank check with VOID written across it, used to prove your account and routing numbers when setting up direct deposit. If your bank does not issue checks, ask for a direct deposit form instead.

W

W-2: The form your employer sends each January showing wages paid and tax withheld. You need one from every employer you had during the year in order to file your return.Full guide: Your first US tax return, explained
W-4: The form you complete on your first day telling your employer how much tax to withhold. Filling it in carelessly is why people are surprised by a bill in April. Check it a few months into any new job.
Wire transfer: A direct bank-to-bank transfer, usually same-day and usually expensive — a flat fee at both ends plus a wide exchange-rate margin on international transfers. Effectively irreversible, which is why scammers ask for them.Full guide: The cheapest way to send money home from the US in 2026

Z

Zip code: The five-digit US postal code. It also quietly determines your school district, your insurance pricing, your sales tax rate and which health plans are available to you — so it is worth checking before signing a lease.