A method should throw an exception if the error needs to be handled by its caller. The try block contains the code that is executed in normal circumstances. The catch block contains the code that is executed in exceptional circumstances. Exception handling separates error-handling code from normal programming tasks, thus making programs easier to read and to modify. Be aware, however, that exception handling usually requires more time and resources, because it requires instantiating a new exception object, rolling back the call stack, and propagating the exception through the chain of methods invoked to search for the handler.

An exception occurs in a method. If you want the exception to be processed by its caller, you should create an exception object and throw it. If you can handle the exception in the method where it occurs, there is no need to throw or use exceptions.

In general, common exceptions that may occur in multiple classes in a project are candidates for exception classes. Simple errors that may occur in individual methods are best handled without throwing exceptions. This can be done by using if statements to check for errors.

When should you use a try-catch block in the code? Use it when you have to deal with unexpected error conditions. Do not use a try-catch block to deal with simple, expected situations. For example, the following code

try {
System.out.println(refVar.toString());
}
catch (NullPointerException ex) {
System.out.println("refVar is null");
}

is better replaced by

if (refVar != null)
System.out.println(refVar.toString());
else
System.out.println("refVar is null");

Which situations are exceptional and which are expected is sometimes difficult to decide. The point is not to abuse exception handling as a way to deal with a simple logic test.