Players should understand that the creation of an interesting character happens primarily through gameplay, not backstory. They should write just enough backstory to give them a scaffold upon which they can build. Everything else should come during the campaign . Otherwise they risk having the most interesting part of a character’s story happen offscreen, which defeats the purpose of the game.
I know this insight isn’t unique or even particularly new. But a lot of us tend to forget from time to time. The Backgrounds in D&D 5e only provide handles for the characters before they start adventuring. Nothing that happened in their lives before the game should outshine what they do once it starts. Back when I played Star Wars Galaxies, I thought of this as a question of discovering or designing characters.
The most interesting things their characters do should happen in the world during play. By the same light, the most interesting things that happen in the world should involve the characters. Note that “world” here refers to the campaign itself. The players may or may not alter the course of civilization. In a city-based campaign, the campaign events should be the most dramatic events in the city during that period.
Don’t fall into the trap of creating a theme park for your campaign. Players should do more than get on some rides and see some shows. They deserve the opportunity to make meaningful choices. Otherwise they can just read a book or see a movie. The pre-eminent virtue of tabletop roleplaying is that the characters can try to do anything. And if their attempts don’t even matter, then why bother?