To begin with, I'm glad to see reincarnation is so popular. Maybe we're onto something! I sure hope so.
What I want to believe right now goes something like this: we take this human form (and the body as shell or garment, as our main tool and vehicle towards completing our earthly goals) so as to better our spiritual part, which is also part of the universal consciousness. By bettering our bit, we better the whole as well. Why is there a universal consciousness to begin with or why does it need betterment via successive human existences, don't ask me just now, I heven't thought about that part yet. But I suppose it can be bettered via other deeds beside human (or animal, plant etc.) existences. That might be beyond our understanding.
Every time we return from an incarnation to the "mothership", aka the universal consciousness, we feed into it the bit we have bettered on our sojourn on Earth, which causes it to go up a bit on the positive scale. The universal consciousness is a place where we know everything there is to know about the universe and also where we act differently than our small core on earth does, because when we there, we are directly connected to all the other cores (we form something like a giant brain) and also because you wouldn't think like humans do on earth at the epicentre of everything. I can't explain more, obviously, because it took me long enough to imagine this bit as it is... Suffice to say, that is the centre of everything that ever existed (which continues to exist in a different form).
If we bungled up and lead a life of crime or such, then we return to the mothership to bathe into the "goodness", replenish our spirit with positive energy and formulate a plan for the next life, which, hopefully, will be a better run. If we were good and achieved most of our goals, then we still bathe in the maximised goodness and still formulate our next plan. The idea is that our "core", the one which has access to the universal consciousness, is essentially good, but due to the conditions imposed on the core by the earthly material existence, we bend, more or less, to passions and everyday pettiness, which cause us to not achieve some of the goals, or go through great hardships in order to succeed.
After a certain time (let's say, when we have completely recharged with positive energy), we launch on our next assignment and start a new life. Now I, of course, want to believe that the people we are the closest to in any given life meet us in most, if not all, our lives. Hard to say what is the deal with the people who cause us pain and trouble but I suppose they also work through their obstacles and may return as a better person at the next life encounter and we may be happy to solve our differences (kumbaya!).
I don't know how this all works out, it sounds like scheduling madness if you're asking me. For instance, will my Mum wait for me so that we can meet in the next lifetime or is she going to get itchy feet (as she would in this life) and reincarnate pronto and go through a life somewhere else, where she meets other people and works out other issues? Because if she's going to be a baby now it's not likely that we would end up having another very strong connection in my current lifetime (though you never know, one neighbour suggested I try for a baby now! I was like, come on, what's the point without Mum around to enjoy a grandchild? But the truth is, I have been obsessed with switching our roles, so... but it is a bit late for me to have a baby that I could see as long as Mum saw me). However, perhaps there is a fatigue period as well? We need to take breaks from reincarnation? Maybe we run different lifetimes with different sets of people? That could be possible. Or we spend a longish amount of time in the universal consciousness bath (that sounds very nice).
This is as far as I have got. I might come back and post if the theory gets more complex as time passes.