Usually, on the first playthrough of any game, I keep the original names. This helps if I need to look up a walkthrough or tips, as I don't have to remember what somebody's original name was before I changed it. But I've done a lot with different names, especially in FFVI.
One thing that makes it interesting is naming everybody the same thing. Though it's a little silly, because when it tells you "Adam gained a level" or "Adam learned such-and-such spell", you really don't know which Adam they're talking about, since you have four characters named Adam in your party at any time. Or you could name all of your male characters by one name, and all of your females by another, if you had a certain ladyfriend in mind or anything.
I've also named them by their most obvious traits or descriptions. I'll name Locke "Thief", Shadow "Ninja", Relm "Kid", Strago "OldGuy", Edgar "Tim" (the tool man Taylor, get it?), stuff like that. I would name Umaro "Dad", because my dad is larger and hairier than I am.
I've tried naming them after friends or family, but especially in FFVI, by the time I get down the line, I run out of names and have to name them after people I'm not very close with. Or I'll inevitably use them less because I'm not too close with the people I named them after. Sometimes I'll also let it affect their development and equipment, and the way I use them, like, "So-and-so is tough and kind of stupid, so I'm going to make this character a big physical fighter, even though it wouldn't suit the character's original intended use."
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