Debt is money that someone owes to someone else. When you borrow money, you create a debt that you must repay. If your older sister lends you five dollars to buy lunch, you're in debt to her until you pay her back.

Debt works on trust: the lender believes you'll return what you borrowed, often with extra money called interest. Banks lend people money to buy houses or start businesses, creating debts that borrowers repay over many years. Countries can go into debt too, borrowing from other countries or their own citizens to pay for roads, schools, or emergencies.

Not all debt is bad. Taking on debt to buy a house or fund an education can be a smart investment. But debt becomes dangerous when people borrow more than they can reasonably repay. Someone deeply in debt might struggle to pay for basic needs because so much of their money goes to repaying what they borrowed.

The phrase in someone's debt means owing someone gratitude, not money. If a friend helps you through a tough situation, you might say you're in their debt, meaning you feel grateful and want to return the kindness someday.