The way I understand it, when we pass, there's a transition period, getting used to being spirit again. After that we review what we experienced in this life, what we learned, and what we didn't learn. Depending on what we want to do, we can wait and just be spirit, reconnecting with others in our circle. Those are the ones we call our soulmates, here on this plane. Or we can decided we want to return to the physical plain.
If we want to return, we decide what lessons we wish to learn this time. Depending on the lessons, we pick our parents and time and place of birth, in order to gain the skills necessary to complete the lessons.