What context can I use each word in?
Learn when and how to use these words with these examples!
debt
Example
I have a lot of debt from student loans. [debt: noun]
Example
She is in debt to her parents for the money they loaned her. [in debt: prepositional phrase]
liability
Example
The company has a liability to pay its employees' salaries. [liability: noun]
Example
The car accident was deemed his liability since he was driving under the influence. [his liability: possessive pronoun + noun]
Good things to know
Which word is more common?
Debt is more commonly used than liability in everyday language, as it is a more general term that covers a wide range of financial obligations. Liability is more commonly used in legal or business contexts.
What’s the difference in the tone of formality between debt and liability?
Liability is generally considered a more formal term than debt, as it is often used in legal or business contexts. However, both terms can be used in formal or informal settings depending on the context.
