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April is Financial Literacy Month. But if you're like most Americans, you may not know what all that stuff means, so we break it down for you.

Welcome to America, where 200 million of us have credit cards, but only 38.5 percent know their APR.

But hey, at least that’s better than the 12 percent who don’t even know what an APR is. 

In honor of Financial Literacy Month, Fifth Third Bank commissioned a survey to find out how much the average American knows about spending. Their findings, unfortunately, weren’t too surprising…

  • Less than half of millennials know what a credit score measures.
  • More than half of Americans don’t know the difference between secured and unsecured credit.
  • Americans are twice as likely to check social media daily than their checking or savings account.

If you’re guilty of scrolling through Instagram while ignoring your bank account activity, here’s what you’re missing out on, and where you can find out exactly what these financial terms mean…

1. APR

What it is: Hopefully you know that if you have a credit card, it has an annual percentage rate, the interest rate you pay on all purchases if you aren’t paying off the balance in full every month. The fees can range from 13-15 percent, which is about average, but some types of cards are notorious for having APR as high as 30 percent. Those include gas credit cards and department store cards — you generally want to stay away from those.

Where to find it: You can find your APR on your credit card statement. But be careful, as there are different APRs depending on how you use your card. There’s purchase APR, which applies to all your credit card purchases, but there’s also introductory APR, which is usually a lower rate for a certain period of time when you first open the card. Penalty APR is a much higher APR you’ll get hit with if you fail to make payments on time. 

2. 401(k) contributions

What it is: One bright spot in the Fifth Third Bank survey was that 42 percent of Americans are currently contributing to a 401(k) retirement plan. But only 13 percent knew they could contribute up to $18,000 per year in a tax-free, individual retirement account. Realistically, not everyone can save that much, but you should still save as much as you can, especially if your employer offers matching funds.

Where to find it: The IRS updates the max amount of contributions you can make each year. You should also ask your HR department if your employer offers matching 401(k) funds.

3. Credit score

What it is: Given that a good credit score is essential for everything from getting a loan to a job, it’s a bit frightening that less than half of millennials know how it’s calculated. Your payment history is the biggest factor in calculating your credit score, but they also take into account amounts owed, length of your credit history, new credit, and types of credit used. Taken together, those factors make up your credit score, a three-digit number ranging from 300-850.

Where to find it: Bad news here — even though it’s your credit score that lenders are using to assess how credit-worthy you are, you usually can’t see your score without paying for it. Different sites offer to do it for free, and banks are increasingly offering it to their cardholders. But if you want an accurate score, you’ll usually need to pay for it at, since that’s the score that most lenders look at.

4. Credit report

What it is: Not everyone knows the difference between a credit score and a credit report. A bit like a school report card, your credit report details how well you’ve done with your credit in the past seven years. Unfortunately you have to pay one of the three credit bureaus — Experian, Equifax, or TransUnion — or have something bad happen, like identity theft, to see a copy of your credit report. With one big exception.

Where to find it: By federal law, you can request one free copy per year from each bureau from You can request them all at once, or space them out to keep an eye on your credit throughout the year.

5. Secured vs. unsecured credit cards

What it is: It’s the catch-22 of needing a credit card to build credit, but not having credit good enough to qualify for a card. For those with bad or no credit, you’ll need to get a secured credit card, which means putting down cash as collateral for the card. For example, if you request a card with a credit limit of $500, you’ll need to pay $500 to open the card.

Unsecured cards are bank or rewards cards that usually require a higher credit score. But they don’t require collateral.

More broadly, secured means you’re putting something on the line to get it. That means a mortgage or auto loan is secured debt, while a student loan  or unpaid electric bill is not.

Where to find it: Bankrate has a list of secured credit cards that most people can get, even with bad or no credit. If you do get a secured card, make sure you pay your balance off each month. The goal is to build your credit with this card, so that you can move onto an unsecured one.

Didn’t find what you were looking for? Check out our full glossary of basic terms for debt.

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Meet the Author

Jess Miller

Jess Miller


Miller is the former assistant editor of


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