Life is a game and sometimes we get so caught up in the story that we forget that that's what it is - a story. When someone is talking to you they are telling you their story, based on their perceptions, their experiences and their current state.
When you separate yourself from someone else's story, it gives you an opportunity to be neutral and just notice what is going on with that person. You will learn so much about them that they are not even telling you. When you learn to really listen, you will notice that not only are you learning a lot about the other person, but you are learning about yourself.
You will notice your ability to listen to what's underneath. What is really bothering them, or making them excited? What are the predominant thoughts they are having? You will be able to asses very quickly where they are in life and how well they deal with people, situations and events. Their story is not about you, but when you get caught up in the story, then you make it about you.
If you learn to distance yourself, and I don't mean being aloof, I mean really listen without taking it personally, you will not only be able to offer a lot, but you will be more empowered.