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Federation is open by default but I never post anything to my home instance because no one is there. If I started posting on my own instance other people could theoretically subscribe to my communities the same way I subscribe to communities on other instances but since there are only two users on my instance it's pretty unlikely people would find it without me crossposting somewhere.

Benefits of me running my own instance are that I control my own user account and I'm not at the whims of another admin. I subscribe to content on lots of other instances and it all federates into mine which means I've been able to browse content when some of the big instances go down. I've got my own entrypoint to lemmy which feels a bit more neutral than choosing another instance to be 'home' for my user.

Downsides are that I have to pay for and maintain it myself which can sometimes be a serious pain. Because my instance only has two users my 'all' feed is basically a copy of my 'subscribed' feed plus a couple posts from communities that my wife subscribes to that I don't. That can make it hard to find new content without using something like lemmyverse.net.

If you're thinking about hosting your own instance I encourage you to give it a shot. I'd highly recommend the lemmy-ansible project on github which is both a guide and playbook for deploying the various lemmy docker containers using ansible. I'm a sysadmin by trade so running services like this is something I'm pretty familiar with but I've still found myself frustrated by Lemmy more than once. It's still a young project and can be frustratingly brittle and difficult to troubleshoot. That being said it's been a great learning experience and makes me feel like I'm doing my part to contribute to a better and more decentralized web.