Your personal context is basically the sum of your life's experiences, beliefs, and influences. You view everything through your personal context; it's like another way of saying your own personal point of view.
When you read literature, sometimes your personal context affects how you interpret that literature. For example: if you are very religious, then you might judge the characters in the novel according to your religious beliefs. Or, if you are a teenager, it might be hard for you to relate to the experiences of older characters. The first time I read The Catcher in the Rye, for instance, I was a high school freshman. At that time, I couldn't identify with Holden very well, because everything about high school was still new to me. When I re-read it as a senior, I understood why Holden felt so disgruntled; there's something about being a senior in high school that matches that emotion better than being a freshman. So my personal context hindered my understanding of the novel the first time I read it, and it aided my understanding the second time.
When you read literature, ask yourself if you are reading it with a non-judgmental, unbiased eye? Or if you are putting your own experiences and beliefs into your reading of it? Then you will know if your personal context is affecting your reading of the literature or not.