Tags or keywords are searchable words in the metadata of an image. They help you have your photos organized into categories and subcategories without creating a maze of subfolders.
Tags or keywords allow you to find files based on common terms you attribute to them such as subject matter, name, event and location. Keywording is a very powerful tool if done appropriately. You have to come up with a group of words but not too many, otherwise you will be lost in the sea of words. There is no sense to pick keywords that apply only to a few photos.
How to select good keywords?
Before you start applying keywords to photos, think about the kinds of words you would use to search for your photos. Really. Start writing up how you would search for a specific picture that was taken on a vacation in Lapland and has your son petting a cute reindeer.
A little help what kind of words might be used as keywords:
Who is in the photo (people – Face Recognition can also be useful)
What is in the photo (other subjects or objects)
Where the photo was taken (names of locations)
Why the photo was taken (what’s happening, event)
When the photo was taken (sunrise/sunset, season, event)
How the photo was taken (HDR, panoramic)
People that are frequently in your photos: you, your partner (I use first names for all of us), your children, your pet. If children have both grandparents and they are captured in the photos very often, I would consider giving them separate keywords, otherwise just “grandparents”. Other options: friends, family, extended family, etc.
As a location tag you can use geographic names (Germany, London) or location generic as amusement park, playground, home, school, forest, mountains, outdoors/indoors, etc.
Type of the image: portrait, landscape, architecture, macro, animal, nature, sport, aerial, baby, etc.
Event: wedding, birthday, hockey game, ballet, holiday, vacation, Christmas
Activity in the photo: swimming, bicycle ride, skiing
Natural events: sunset, rainbow, summer, night
Pro tip: Luckily, you don’t need to do this one by one. With a photo organizer software you can do it in bulk.
You can read about photo organizing/managing software here.