People think that it is a way to add words to the auto-correction or spelling dictionary but after doing some research its not, i found this explanation in another forum:
the user dictionary is designed to help people writing Japanese or Chinese. It allows users to pre-set which Chinese characters appear when they type a phonetic version of a word. It's commonly used for names of places and people and is a standard feature of most character based input systems.
Entering words in here will neither add them to the auto-correct dictionary, stop them from being underlined in red or enable any Text Expander like features.*