When you die, your soul goes to Hereafter, where it's then sent to a fitting place. Souls who live virtuous lives are sent to a "good" afterlife, and people who suck and are godawful people go straight to hell. If nobody knows who you are, and someone could argue that you never even existed, then you get dumped in Myosotis, the afterlife where forgotten souls and junk the gods don't want to destroy go.
Living beings can live in Hereafter; In fact, Hereafter is a popular location for living beings to visit for the novelty of going to literal hell, as hell is open to tourists to torment it's souls via throwing peanuts, tapping the glass on the souls' enclosures, or bringing crying toddlers who really, really wanted to ride that rollercoaster that they were sadly a couple inches too short for.
The actual soul judgement occurs in Hereafter's capital, Hereafter City, a surprisingly colorful city bustling with life, which is filled with artsy folk who think it's so cool and edgy that they live in the place dead people go, soul workers (that is, people who are involved with sorting and managing souls), particularly loyal followers of the god of death, among other people who enjoy the city's cheerful, yet somber atmosphere.