The validity period is how long a carrier keeps trying to deliver an SMS to an unreachable phone before giving up and marking it expired; a gateway lets you set it per message.
When a phone is off or out of coverage, the SMSC stores the message and retries. The validity period caps that: after it elapses, the message is discarded and reported as expired. Carriers accept values from minutes to days; the useful value depends on the content. A one-time code has no value after ten minutes; a delivery notice is fine for a day.
Setting validity short on codes avoids delivering a stale code that confuses the user and creates a support ticket.
At SMSMeteor: the default validity is 48 hours, settable per message with the validity parameter in minutes, up to 72 hours.