Character creation is one of the fun things about being a player; you get to imagine being somebody else for a while; think up a whole personality, history and extended family. Some players don’t go quite that far, but I know a number of them that do, and really enjoy the process.
For a GM, who is running a whole menagerie of characters, many of whom are as far from human as one can easily get, it can be a serious project just to create a small town. And then you have encounters, and … whoo. Notebooks, just full of NPCS!

My advice is… don’t. write up some roughs; name, apparent gender, what they basically do and where they can be found or might turn up, and maybe a quirk. Just keep a list of those names. If one of them goes and develops a personality, bonus! But generally, you won’t be sitting around with your thumb in your ear trying to figure out who’s related to who and how … as a rule, no one will ever find that out, or need to know it. Why torment yourself needlessly?
And, while we’re on the subject, be very careful about your own personal character inserts; most of the time, that is not going to work like you think it will. Player characters can be very difficult to impress, and really.. the story is about them and their accomplishments, isn’t it?
Now, someone who’s gamed with me might, at this point, be saying, ‘now, wait a minute, Thorne. You have a GMPC in the game you run!’
This is true. I do. But that character doesn’t really /do/ very much. She’s there for those times when the party needs a specialist in the Arcane, and a crafter-on-call, and not really there to steal the show (although she did save their butts once or twice…). I believe she is valued, and I do have fun running her. But in the end? She is part of the team, and while she contributes, she only has a very small part in their accomplishments.
… and I killed her last week, so she’s not immune.
I killed – or nearly killed – a lot of characters last week; the party got split three ways when they fled the encounter (remember I said play your NPCs to their strengths? Yah. .. Vrocks, man), and we ran a little over and no one cared. Which, I guess, means I’m doing something right. A Reincarnation here or there and everyone is more or less fine… but the party is still split, and I’m going to have to get everybody set up again!
Now, I’m not just taking a few rough notes and flying with them; because I am working with a module. That’s a few friendly NPCs that I didn’t do much more than take the starting notes for and run with (I suspect the guys who wrote the Shattered Star AP didn’t really expect people to take whatever head-canon they have from preceding APs and adjust Shattered Star to fit…), which, for a second tip … DO THIS. If you have to tweak some things, by all means. But do it! It will make things much more interesting for your players to see hints that their characters have had an effect – a lasting effect, even! – in the game world.