Perhaps the most misunderstood feature of Digital Photography, setting the proper white balance is something that most users take for granted or don't do at all. A lot of times we are content in leaving our cameras at the AUTO setting and AWB (Automatic White Balance), but is this really the right thing to do? Well, for most applications AWB is good enough and achieves good results.
So when is it necessary to use the 'other settings' that our digital cameras offer? Well, the simple answer is whenever we can (at least when were not shooting in RAW) In my experience it is ok to leave AWB when:
1) Outdoors
2) In a shady area outdoors
3) Using Flash (although not in mixed lighting conditions)
While in these other situations it is best to use one of the other white balance settings.
1) Indoors under fluorescent lights
2) Indoors under Tungsten lights
3) Under mixed lighting situations (ex. par lights which are tungsten and a bright white
spotlight and your flash)
Using different settings or the wrong white balance setting will lead to a color cast that is very difficult to remove completely in post production, so it is always advisable to get it right the first time. Also, we must note that some people like their portraits to have a slight reddish and yellowish color cast which makes the skin tones look warmer. Of course if you shoot RAW none of this should be a problem.