A Memo ID is generally used to tie a transaction to a specific sender so that the recipient will be able to identify to which the transaction belongs to. For example, an Exchange may require and provide a Memo ID which the user then would use when making a deposit. An XLM Memo ID will contain letters and numbers.
In most cases though, a Memo ID is not required and is optional if simply transferring between wallets and not to exchanges.
The Memo ID can be entered at the Slide to Confirm screen just below the Fee selection.