What does Psalm 103:2 mean?

In this verse David calls upon his soul to praise the Lord wholeheartedly because of the benefits He bestows. David is cautious not to be thankless or casual about everything God has done for him. He cautions his soul to "forget not all [God's] benefits." The word "benefits" suggests gracious dealings. David did not want to forget how graciously the Lord had treated him. Perhaps he had in mind the time the Lord used him to defeat Goliath (1 Samuel 17). He might have recalled the many times the Lord delivered him from hateful Saul in the wilderness (1 Samuel 19; 1 Samuel 23). He may have remembered how the Lord established him as Israel's king (2 Samuel 5:1–5).

Moses rebuked the people of Israel for forgetting the Rock that carried them in their wilderness journey and the God who brought the nation of Israel into existence (Deuteronomy 1:31–33. The generation of Israelites that had entered Canaan eventually forgot the Lord. They "abandoned the LORD, the God of their fathers, who had brought them out of the land of Egypt. They went after other gods, from among the gods of the people who were around them and bowed down to them" (Judges 2:12). Their failure to remember the Lord and His benefits incurred the Lord's judgment. He gave them into the hands of plunderers and enemies (Judges 2:14). Remembering to praise the Lord for His gracious dealings with us keeps us free from undue discipline and distress.