So white balance is really the forth variable you control on your camera. Assuming you're shooting in manual mode. It doesn't effect the exposure. What it effects is the overall colors in your photograph.
The idea being you want to select the whitest point in your frame and have that be corresponding to what true white is. And if you get it right, the rest of the frame will look good. There's a couple of different ways you can adjust your white balance. I personally like to put it on auto white balance and not worry about it.
Some of the better ways to do it is to physically set it manually using the kelvin scale in your camera. Not all point-and-shoots have this ability, but all DSLRs do. The kelvin scale is a scale that ranges from 25 hundred up to 10 thousand. 25 hundred is going to be really blue. Whereas 10 thousand is going to be really yellow. It's a scale that you adjust to get it just right.
You can take a photograph, see where it is on the scale, and adjust accordingly. Again, kelvin is color temperature, just like kelvin is physical temperature. It's the same sort of concept.
Another really great way to set your custom white balance, and this is something I tend to do when I'm shooting basketball games because gymnasium lighting is so wacky. What you physically do is you take, and most, almost all DSLRs have this setting. It's different between all the manufacturers so you're going to have to look up how to do it. It's very simple. So you select this option and essentially you hold out something that is white, let's say a piece of white loose leaf paper, and you fire your camera at that paper under the light with the light hitting the paper and your camera will read that as the white balance and set the rest of your photos to be the same.
What I even got to the point of doing when I was shooting a lot of basketball is I would have various white balances preset into my camera for various arenas. So when I was shooting at Madison Square Gardens, I would have a Madison Square Garden color temperature set. So when I showed up there I'd just set and keep shooting.
I've got a couple examples here of good and bad white balances that I'm going to show you. This one is obviously too blue on the kelvin scale so this would be way down low towards the 25 hundred mark. And this one is a bit too yellow. Not quite close enough to 10 thousand, but higher up. This one right sort of in the middle of those two, and this is a really good color balance.
Again if you look at the purest white in this photograph, you can look at his collar, you can tell that his collar in this photo is a pure white. Which means you nailed it. If you screw it up and you're shooting raw, it's something that's easy enough to fix afterwards in a raw processor like Lightroom. If you didn't shoot raw and you mess it up, you can always tweak it with color balance in Adobe Photoshop. Although it's going to be a lot harder to correct.
Those are just the basics of picking and setting your white balance.