How to set the timing on the XL 250 1975 Honda?

How do I set the timing on the XL 250 1975 Honda

Best way is to find a Shop Manual.
Second best way is to find a local old mentor that owned Honda's, especially that Model/Year. (I'd try to help more but I rode Yamaha, sorry. If you post a few pix of the mag rotor and such I could guess a little. LOL!)

Remove the spark plug.
Rotate the flywheel until the points open the widest.
Set the points gap to specifications.
One of the screws that holds the points to the engine is to adjust the gap.
The other screw is to move the points' base plate to adjust the timing.
Loosen that screw a little (just enough to allow the points plate to move).
Turn the flywheel to close the points gap.

Now "statically" adjust the timing (static = engine not running).
Attach a 12v test light to the wire that goes to the points (stick the test light into the connector).
Turn on the key.
The test light should not light up yet.

The flywheel has lines on it.
"T" is for cam timing (don't concern yourself with that).
The other line "F" is the timing line.
When it lines up with the marker on the engine, the timing is correct.
Always turn the flywheel in the direction it rotates when the engine is running.
Turn the flywheel until the test light lights up.
Continue turning the flywheel.
The test light should turn off exactly when the flywheel "F" lines up with the marker.

Use a flat blade screw driver to move the points' base plate
Moving the points' base, adjust's the timing.

Now adjust the timing with a test light.
Remove the round cover (with 3 screws) on the left crankcase cover.
Hold the bike straight up, there's oil inside.
The timing has a mechanical advancer.
It adjusts the timing when the engine RPMs increase.
Shine the timing light at the "F" line on the flywheel.
Start the engine and rev it a little to move the advancer and adjust the timing with the points base plate as mentioned before.

If this is confusing, follow Chris' advice.