You can use your other character(s) for extra storage, also to sell things semi-anonymously or to try out a new race.
I made mine before it became so cheap to add mod slots. I ran him to just the point where all 4 mod slots on found and purchased items would be open, then using a friend transferred the items to my main character, which was around 3200 at the time. Now it doesn't matter, it's so cheap to open mod slots that I wonder why Trion doesnt' just have them all open all the time.
About the only reason I can see would be to get equipment of lower ego for trading purposes.
EGO - 5900
PC-NA Character Name - Dod, Account Name - ironcladtrash
I made a new character on the NA server and i got all my DLC stuff and the ark hunter code stuff, plus i got the 500 bits again that come with the game, these could be used on both servers
Xbox GT: JD TheNutz
EU Servers: KT Starbuck
NA Servers: Torog
So I can play at all kinds of weird times, depending on which server I decide to play on. Started an Irathient character on the US server months ago, and started a Castithan character on the EU servers once the DLC went live. Wanted to see how Paradise was over on the other side of the globe.