Sometimes a lengthy explanation is not quite what we're looking for. So, here's a quick guide to using the relationship indicators in Rails models. (As always, the Rails API should be referenced for the official usage.)
belongs_to
Use belongs_to :something when a table has a one to one relationship. (i.e. a car has one steering wheel.) This relationship always goes on the model that has the foreign key field (i.e. steering_wheel_id)