Living people have physical brains, and those brains contain loci that when electrically stimulated call forth detailed memories. When a person dies, the brain dies with him or her, so spirits have no physical way of recalling a past memory. However, once a spirit has decided to cross over from the transitional plane into the mainstream sequence, the memory of its past life, along with a full sense of continuity is restored. In the mainstream spiritual world, all the memories that a person has accumulated over his or her lifetime are permanently accessible after death.
Where spiritual memories are stored is unknown, although some believe that all memories and events are stored in what has become known as the Akashic records. These records are available to all spirits within the mainstream sequence. Although they are records of ALL events, thoughts and actions, past, present and future, any given spirit can instantly access only those records that pertain directly to it. I’m not here to argue the reality of these records, but they offer an explanation of how souls in the spiritual world may be able to draw on knowledge of their own lives.