When does someone know they have interpreted it correctly?
When is it misinterpreted? When it is interpreted differently than the Magesterium of the Church, the church Peter started, per Jesus, that had the name Catholic capitalized on it when the reformations took place. People fail, sin, and popes and priests are no less sinful, but in interpretation by the Magesterium, the Church is always correct, and was given poewr to hold or loose.
If they didn’t loose contraception in the last 100 years, they show some pretty good focus. The sex abuse scandal and ....problems that led to reformation complaints demonstrate the sinfulness/failings of men, not the Church’s interpretation.
God has given believers the Holy Spirit to guide. Correct interpretation with the help of the Holy Spirit leads to greater righteousness in life which is the main indication that one is on the right track.
That doesn't mean one will not err...all are human.
However, those who have faith and are obedient to the Holy Spirit will continue to follow a correct path whether that means interpretations made on one's own or whether that means listening to others' interpretations.
This applies not only to Bible reading but to all areas of living.