I’m a beginner learner in Japanese who just got to level 5. I’ve seen a lot of homophones across the material so far; for example, “sei” can be used as pronunciation for ‘correct’, ‘life’, ‘generation’, etc. I understand how people can differentiate these words if they’re reading the kanji, but how can they differentiate them if someone is speaking these words? Is it just a matter of practicing a lot and understanding where these words might come up? Do people ever have to guess what word is being said, and is there ever any ambiguity about what someone is trying to convey?
Context. It’s all in the context. Same way you tell the difference between homophones in English.
For starters, you’re not going to encounter a kanji reading せい all by its lonesome - they’re gonna be in words. And then those words are going to be in sentences, and those sentences are going to be in the larger flow of topics.
It’s all about context, where the word was said in the sentence and what other words are around it. For example, から means “from” but when it’s tacked on to the end of a sentence it means “because.” I suggest not overthinking it. Just learn as you go and it will come together.
In some ways it’s like English. For example, “set” means both to place something (often down) but there are TV sets, sets in tennis, all sorts of things. As English is our first language we don’t even have to ponder it. We just know and that’s how it is for native Japanese.
First of all you’ve listed kanji readings and not words, and listening is about focusing on words. For example, the kanji for 生 can be read せい in compound words but it’s rarely used alone.
Secondly, context is going to help you a lot. Like often does the fact that lead (the metal) and led (the past tense of lead, the verb) have the same pronunciation affect you as an English speaker? Or “set” has like 100 meanings.
When words are the same sequence of mora, there’s often pitch accent to differentiate them, like 橋 (はし - bridge) and 箸 (はし - chopsticks). Actually in some ways the wrong pitch accent can be more detrimental than the wrong consonants, as I found when I used to confuse a teacher during speaking lessons between 近い and 違い because I used the wrong pitch.
(just by the way, you do sometimes hear せい as a word by itself, but in the construction Xのせい meaning “X’s fault”. you could see it in kanji as Xの所為, but it’s usually written in hiragana. if we’re asking “what does せい by itself mean”, this is the word i would reach for first)