“I'm at the point where I can understand most of what's going on around me.”

You're studying a 3rd language. You can usually understand what people are saying in that language. A friend asks you about your progress, so you reply.

I'm at the point where I can understand most of what's going on around me.

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I'm at the point where (clause)

This phrase is used to explain your current situation. It can be used to talk about your feelings. For example, when talking about a child who's getting into a lot of trouble:

I'm at the point where I just don't know what to do any more.

Or it can be used to talk about your current situation when working on a project:

We're at the point where we're going to need to start hiring extra people to keep up with the workload.

But the phrase "I'm at the point where ___" is only used for talking about things that take place over several weeks, months, or years. You wouldn't say "I'm at the point where I'm hungry", for example.

understand what's going on around (one)

"What's going on around me" means the things that you can see and hear, and that are happening close to you. People usually talk about understanding, paying attention, or noticing "what's going on around (someone)":

Keiko was just sitting there, reading her book, totally unaware of what was going on around her.

You can't play around when you're driving. You've got to pay attention to what's going on around you.