The best way I’ve heard WordPress categories described is that they are the folders in your file cabinet — if your blog posts were printed pieces of paper you had to organize.
While categories do help you keep your content grouped, the reason you’ll want to give a damn about them is because categories help your audience find similar content (aka the content they are interested in) AND they help Google know what your site is about (which gets even more eyes to land on your site.)
Not every writer starts their blog knowing the exact categories they need, which is why WordPress makes it really easy to add categories on the fly. So don’t stress out if you’re unsure, but it is better to add categories as you go vs waiting until you have 300 posts that you need to categorize.
I won’t ever tell you how many categories you should have, cause that’s nonsense.
However, if you find yourself really struggling with the category concept, aim for 3-9 categories to organize your content. You could organize it by the type of content you provide or maybe by the subject matter (software, systems, hardware + products that a business might use.)
Food bloggers know that the type of recipe they are sharing makes for a perfect category — breakfast, salad, appetizer, entree, dessert, etc.
Subcategories are more commonly used by sites with an extensive library of posts.
Someone who blogs daily, or news sites, benefit from this structure. You’re likely fine sticking with one level of categories to put your content into.
Once you have your categories going, you can add those links to your menu or sidebar to get your visitors in front of the content that is the most useful to them. or link to them at the end of each post (like this.)