RTP stands for return to player. A slot with 96% RTP pays back $96 for every $100 that goes through it, averaged over millions of spins and all players.
The catch is in "goes through it". RTP applies to every spin, not to your deposit. When you win, you usually spin that money again, and the machine takes its 4% again.
Where the $100 goes
Say you deposit $100 and play $1 spins on a 96% slot until the money runs out. On average you get about 2,500 spins before it's gone. That's $2,500 wagered, and 4% of $2,500 is your $100.
So the 96% doesn't mean you keep $96. If you play until you stop winning, you lose the whole deposit. RTP only tells you how fast that happens.
Why it still matters
A lower RTP drains you faster. The same $100 lasts about 2,500 spins at 96%, about 1,670 at 94% and only about 1,250 at 92%. A few percentage points can cut your playing time in half.
RTP also tells you nothing about a single session. Slots are built to swing: you can be up 300% one evening and lose everything the next. The RTP is the long-run average of all those evenings.
See what your RTP costs per hour on the slots calculator.