Broadly speaking, anything supernatural in the setting originates from collective belief
People believe that the spirits of the dead coexist in the world alongside them.
The "spirit world" is essentially just a separate layer of the world that generally maps 1:1 to it.
Heaven is just being in the spirit world in good standing with God
Hell is in poor standing
Many spirits are in neutral standing (think: nature spirits, non-malicious pagan deities, fairies and such).
You can't really go to or see into the spirit world, so from the player's perspective this is all very vague
Magic is the intervention of spirits in the world of the living
Its hard magic in the sense that there are different kinds of spirits with specific, knowable things that they can do and specific, knowable ways of communicating with them
Its soft magic in the sense that communication with them is unreliable and since they are conscious entities, they are capricious and often unpredictable
There is no "mana" or any explicit resource like that. How much they choose to help you is no different than how much an actual person might choose to help you, and their help may be conditional on what exactly you want their help for.
The closest thing to "mana" or a measurement of how much magic power you have is essentially just the sum of how much various specific spirits are willing to help you out.
You don't even have an accurate way of determining what this hypothetical number is though, due to communication being difficult and unreliable.
Some spirits can help you out in combat, functioning as handicaps for players with poor mechanical skills
These function at the input-level. If you are already very accurate with aiming your attacks, they won't really help you much and they can't help you be more accurate than a skilled gamer
There are three different kinds depending on which mechanical skill you are lacking in
Precision spirits act as if your aiming reticle is closer to the target
Reflex spirits act as if your reaction time when performing a dodge was faster
Leading spirits act as if you were leading a target by the correct amount, like if an enemy is moving horizontally relative to you then you can simply aim at where the enemy currently is, not where they will be, and the spirit makes up the difference
These spirits are not discrete, you can have a small magnitude of assistance of them if you are not quite pro-gamer level or a large amount if you are extraordinarily bad at the game
They do not apply in any PvP "dueling" context
Spirits, by default, try and help you in a time of need
They can cause enemies to whiff attacks, fail to detect you, or turn a lethal blow into a non-lethal one
This works better the weaker your character is
This lets you play as a child or a halfling or an old person and not just be dead weight in your party
Many players will not like the realistic, hardcore nature of the world and should invest much of their favor into this kind of spirit to compensate so that it's less brutally punishing
Alternatively, spirits can be instructed to not generally act of their own volition to help you, instead being commanded directly by the player
To do this, you must "equip" the spirit from a slot
A spirit can be associated with a given slot
It can be associated with a specific trinket, like an heirloom or a crystal. It may be affixed to a wand, scepter, or staff that you hold. Or you can just hold the trinket itself. This is a western convention.
It can be bound to a tattoo on your character at that location on your body
It can be imbued within your body itself, aesthetically this has something to do with chakras. This is an eastern convention.
If its a tattoo or chakra you can't have any armor covering it, otherwise you can't access it
Using a tattoo/chakra for magic makes it very fast to equip/use, using a staff is more powerful but unwieldy
Once equipped, a spirit may change what your actions do
Attacking with a spirit will cause the spirit to attack with whatever sort of effect or element that its associated with.
If you are powerful and an element is readily available in the environment the effects of the attack may extend far beyond your weapon/hand
Attacking with a staff/wand using a spirit is essentially what a wizard normally does. The "spell" is just based on what kind of attack and spirit you do.
Not so much "fireball", more pointing it at a lantern hanging on a building and flaring it up, causing some embers to spread around and ignite a fire
The UI might give you some indication of what's going to happen: when you look at a source of a given element you can see some embers/snowflakes/static over the area that it might affect if you were to attack
These "spells" are all things which spirits may normally do of their own volition, you're just causing them to do these at-will rather than automatically when you are in danger
Even as a generalist, you don't usually see a lot of opportunities for this. If you aren't near a plentiful source of a given element there isn't a ton you can do
Even though wind and earth might comparatively be very plentiful, you actually need the wind to be blowing or to be near a faultline to do anything significant with them
Elemental magic is not a reliable way to fight enemies, its something that is situationally extremely useful but usually irrelevant.
An unarmed martial artist using a spirit is essentially bending, as in Avatar: TLA
The effects would be much less fantastical though
In comparison to using a staff, it would be faster but with less magnitude in its effects and shorter range. Essentially you could go toe-to-toe with an equally skilled armed and armored combatant while yourself unarmed and unarmored. Staves are too unwieldy for this if an enemy gets close.
Attacking with a regular weapon just imbues that weapon with the element. This is how you light your sword on fire or electrify it. It still has to plausibly (though improbably) obey the laws of physics though, so if you want a flaming sword it should have some oil on it to burn.
Some types of spirits may specifically help non-attack actions more. Wind spirits help with dodging, ducking, running, and jumping. Water spirits help with swimming. Fire spirits prevent you from catching fire when walking through fire. Earth spirits help you maintain your poise.
These defensive actions might not necessitate the spirits being actually equipped in your hands. But you probably do need appropriate slots to be unarmored.
Some spirits will want to help you with a specific cause
Divine spirits try and help you do good, they will not only be useless if you try and do evil but will outright work against you
When your character prays to God, they are essentially saying "God, please lend me some divine spirits and I will use them to carry out Your will"
There can also be lesser nature spirits that aren't necessarily acting on behalf of God, yet are similarly conditional with their assistance. This is how a druid gets their magic, and they will normally only function within a specific area (conventionally a forest) that the spirit is associated with
Some spirits are purely transactional
You can obtain their assistance through explicitly transactional means. Make an offering to them, help out their descendants
This is how a wizard goes about obtaining spirits
Some spirits can be entertained
Play or sing music or dance to entertain spirits
This is how a bard obtains spirits
This isn't purely within the span of combat, if you want them to keep following you around you should be dedicating a good fraction of the day towards entertaining them
Favor with spirits are the default sort of quest reward, rather than every random peasant having enchanted weapons lying around to give you or heaps of gold or you just receiving abstract "experience points" (not a thing)
In general, its very rare for spirits to care much about NPCs. They are one of the factors that differentiate your characters from NPCs, which crucially doesn't require you to actually be physically powerful
You don't normally need to worry about random NPCs being saved via divine intervention by spirits and screwing up your combat.
You do need to worry about this in PvP. If you want to go randomly murder some poor noob your assassination might not only be foiled by their spirit, but you may be cursed if you manage to succeed in spite of this.
If your character is powerful physically or involved in faction warfare, you will not be protected against "unfair" PvP assassinations
Spirits try and communicate with you
Usually to warn you of danger or guide you on a quest
The means of communication depends on the type of spirit
Wind spirits may cause ominous howling wind from a particular direction
Fire spirits might flare a candle or cause it to go out
Earth spirits might cause a tremor
Nature spirits cause plants to wither
Non-elemental spirits might just communicate via music, representing your character's gut intuition
The more attuned your physical senses are the better you can sense them
You want good hearing with no helmet on to best hear wind spirits
You shouldn't be wearing shoes to sense earth spirits
Outright being blind or deaf can help you focus on whatever other senses you are relying on
You might do this situationally with a blindfold. Like you sense that something is awry, then close your eyes or put on a blindfold to better listen to the wind
Some characters prefer to be attuned with a particular type of spirit, others are more general
You could specifically be a pyromancer/firebender, or generalize across two or more
The more you generalize the less effective you will be with any particular kind of spirit
The exact taxonomy of spirits is setting-dependent
In a modern/sci-fi setting
Rather than there being separate "fire" and "ice" spirits there's just thermodynamic "spirits" that now obey the law of conservation of energy
Wind/earth/water essentially become telekinesis
Lightning/metal become electromagnetic
Rather than being "magic" this is stylized as "psionics" or "the force"