Let’s talk about CRS…
A Coordinate Reference System (or CRS) is a system of coordinates used to identify locations on your map in QGIS with the corresponding location on the Earth. For example, the QGIS default “WGS 84 (EPSG:4326)” represents points on the Earth using the standard latitude and longitude degrees as coordinates. (The name WGS 84 comes from the fact that these coordinates come from the WGS 84 ellipsoid used to model the shape of the Earth).
All CRS are associated with a particular projection of the (3D) Earth onto your 2D screen, so different CRS will have different properties, advantages, and disadvantages. In particular, all projections will necessarily have distortions in some form (either in angular conformity, distance, or area), so you will need to choose your CRS to minimize the distortion in factors that are most important to your use case.
It is important to consider the units of the CRS as that is what QGIS processes will use as the default in most cases. If you are calculating lengths or areas for instance, you might obtain results with degrees as units because QGIS defaulted to the units defined by your CRS.
You may assign the project as a whole a specific Project CRS, while layers can also have their own Layer CRS. To check information about your CRS, or to change the Project CRS, click on the globe in the lower right hand corner. To change layer CRS, you should reproject your layers using Vector > Data Management Tools > Reproject Layer… for vector data or Raster > Projections > Warp (Reproject)… for raster data in order for them to display properly, or to continue with your analyses. (Just changing the Layer CRS without reprojection may cause errors when running QGIS analyses.)
We highly recommend setting the CRS for your project at the start and making sure that each layer is aligned with that CRS (typically the WGS 84 mentioned above). If you skip this or try to ignore CRS, you will end up with errors that will impact your ability to run certain analyses or exports.