Clarification about precedence of settings

Closes #14559

docs/reference/cluster/update-settings.asciidoc

@@ -83,6 +83,16 @@ Cluster wide settings can be returned using:
 curl -XGET localhost:9200/_cluster/settings
 --------------------------------------------------
 
+[float]
+=== Precedence of settings
+
+Transient cluster settings take precedence over persistent cluster settings,
+which take precedence over settings configured in the `elasticsearch.yml`
+config file.
+
+For this reason it is preferrable to  use the `elasticsearch.yml` file only
+for local configurations, and set all cluster-wider settings with the
+`settings` API.
 
 A list of dynamically updatable settings can be found in the
 <<modules,Modules>> documentation.