There are two main benefits to having a group identity. One has to do with one’s own feelings and the other has to do with how one behaves.
With regard to feelings, having a group identity gives a person a way to feel connected to something that is larger than him or herself. If we do not have a group identity, it is hard to really feel that we are part of something big. We can feel very isolated, as if we do not know who we are and do not know where we belong in society.
With regard to our behaviors, group identity gives us some cues about how to act. By knowing what group we belong to, we know what sorts of behaviors are expected of us. This makes it easier for us to know how to behave.
In these ways, having a group identity is good for us. It allows us to know how we are supposed to behave and it allows us to feel that we are something more than an isolated individual.