The reason why the pilgrim in ihram takes off his ordinary clothes

Praise be to Allah.

The reason why he takes off his ordinary clothes is so that he will be completely humbled before his Lord, may He be glorified and exalted, both outwardly and inwardly, because wearing the rida’ (upper garment) and izaar (lower garment) is a kind of humbling oneself. You will see the richest of people who could wear the finest of garments looking like the poorest of people, because he is humbled completely. It is also a show of unity among the Muslims, for they become one ummah even in dress; they circumambulate one building, they stay overnight in one place, they stone the Jamaraat in one place. 

A third benefit is that the individual is reminded that when he departs this world, he will only depart in garments like these. He will never depart in the finest clothing; rather he will depart in a shroud. And Allah is the One Whose help we seek. End quote.