SharePoint patching constitute of three types, Service Packs, Cumulative updates and hotfixes. Patching is considered a B2B (build to build) upgrade.
Generally service packs are not a set schedule but they are around 18 to 24 months. They fix all the bugs that have identified since the last service pack or RTM. Sometimes service packs introduce new features and functionality. These are thoroughly tested before release and it should immediately be tested in a test environment. Once tested for feature and functionality in test/non-prod environment they should be released to production at the earliest as service packs are dramatically affect performance and security.
Cumulative updates are normally released in every other even numbered month and they are attempt to fix bugs identified in those months plus they include fixes for all the previously fixed bugs as well. The size of these CU’s grows as they are being released. Unless if any current affected issues are resolved in production environment they are not generally necessary to install. Sometimes these Cu’s can break things if they don’t work properly. Patches cannot be uninstall and you will be helpless and wait till the next CU is released. Test the fix the CU is providing thoroughly in test farm and wait for a couple of weeks for any regression before updating to production.
Hotfix or a security patch. These are generally pushed through windows update. These attempt to fix any urgent security issues in SharePoint and are release as early as possible and could be the lease tested of all the patches. Install and run configuration wizard to complete the process. Fingers crossed and prey they should not break any other functionality.