Before we were born we lived in the presence of God but we had no body. We were spirit children of our Heavenly Father. He presented this plan, with Christ as the center, so that we would be able to have all of the blessings our Father in Heaven wanted to give to us.
"Before I formed thee in the belly
I knew thee;
and before thou camest forth out of the womb
I sanctified thee,
and I ordained thee
a prophet unto the nations."
-- Jeremiah 1:5
Under the Direction of the Father, Jesus Christ created the Earth. All things are and were done in order, and we needed somewhere to go to gain physical bodies, and to be tested.
Heavenly Father then created Adam and Eve.
"And God said, Let us make man in our image, after our likeness:
and let them have dominion over the fish of the sea,
and over the fowl of the air,
and over the cattle, and over all the earth,
and over every creeping thing that creepeth upon the earth.
So God created man in his own image,
in the image of God created he him;
male and female created he them."
In the Garden of Eden, God gave Adam and Eve their agency. He commanded them not to eat the forbidden fruit, that being the fruit of the tree of knowledge of good and evil. However as was expected they were tempted and used their agency, or the ability to make choices, and decided to eat the fruit. This meant that they could no longer stay in the Garden of Eden, but they were then able to have children and learn from the law of opposition. While in the Garden they did not know what pain was, and so they did not understand being comfortable. Without sickness they couldn't appreciate being healthy. After leaving the Garden they began to understand these things.
Then after a few years...maybe a lot more than a few...we were born into the world. We also must learn from the experience of life. We make mistakes and have to learn how to fix things. One of the greatest things about life is having a physical body like our Father in Heaven. This is what allows us to make decisions about what we want to do. The other most important part of life is to be tested and see if we will be faithful in doing what the Lord has told us to do. We don't remember anything from before we were born because we have to act in faith rather than having a perfect knowledge of things.
"For we walk by faith, not by sight"
God knew we would not be perfect in keeping His commandments. He provided His son, Jesus Christ, as the Savior and Redeemer of the world. Christ came to teach the people, set up His church upon the earth, and then suffer and die for us.
"And he shall go forth, suffering pains and afflictions and temptations of every kind;
and this that the word might be fulfilled which saith
that he may loose the bands of death which bind his people;
and he will take upon him their infirmities,
that his bowels may be filled with mercy, according to the flesh,
that he may know according to the flesh
how to succor his people according to their infirmities."
This was indeed an infinite atonement, where Christ took everything upon himself. If we are ever having a bad day, He knows exactly how we feel and we can always turn to Him for help and support.
After we die we go to the Spirit world. Which is a fancy way of saying we are somewhere other than here. ;) Those who have lived righteously will dwell in a state of peace and happiness, while those who are disobedient to the laws of God will be in a state of misery and shame.
"And now, my sons, remember,
remember that it is upon the rock of our Redeemer,
who is Christ, the Son of God,
that ye must build your foundation;
that when the devil shall send forth his mighty winds,
yea, his shafts in the whirlwind,
yea, when all his hail and his mighty storm shall beat upon you,
it shall have no power over you
to drag you down to the gulf of misery and endless wo,
because of the rock upon which ye are built,
which is a sure foundation,
a foundation whereon if men build they cannot fall."
-- Helaman 5:12
After our time in the Spirit world, and after the Second coming of Christ, we will be Resurrected and Judged. This Resurrection is for everyone. We don't choose to die, so in essence we can't choose to live. But Christ has won the victory over death.
In the Judgment we will be assigned to different Kingdoms of Glory. The Celestial, Terrestrial, or Telestial.
"There are also celestial bodies,
and bodies terrestrial:
but the glory of the celestial is one,
and the glory of the terrestrial is another.
and the glory of the terrestrial is another.
for one star differeth from another star in glory."
The Celestial Kingdom is where those who followed Christ, received the ordinances of the gospel, and kept all of the covenants associated with those ordinances. This is where God lives. Those who receive exaltation in the Celestial Kingdom will be able to dwell in happiness with those of their family who qualify forever.
The Terrestrial Kingdom is where those who lead good lives but did not accept the fulness of the gospel of Jesus Christ will go.
The Telestial is the lowest Kingdom and is where those who led sinful lives and chose not to repent when they had the opportunity to do so.
"Ye cannot say, when ye are brought to that awful crisis,
that I will repent, that I will return to my God.
Nay, ye cannot say this;
for that same spirit which doth possess your bodies at the time that ye go out of this life,
that same spirit will have power to possess your body in that eternal world."
Below is a picture depicting how everything I have talked about works.
Hope you have a good day.
"Wherefore, if ye have sought to do wickedly in the days of your probation,
then ye are found unclean before the judgment-seat of God;
and no unclean thing can dwell with God;
wherefore, ye must be cast off forever.
and deny them not."