Regarding the importance of income level, I'd say it varies based on the situation. That should be obvious, but... not everyone would understand how other people view any given income level and why they may covet more.
For many, it could simply be to make life far more comfortable without changing anything in their life, so, no increased mortgages, no extravagant car payments (perhaps a reasonable upgrade after holding onto a vehicle that is 10+ years old, if not far older), no upgrades for children to private schools or otherwise changing much at all.
For those, a significant pay raise may move from struggling to make ends meet to actually having the ability to put money away in savings and perhaps even set aside from new things, be it college tuition for self or children, or perhaps a significant down-payment to upgrade from the bungalow in an area rapidly becoming sketchy to a modest house where all the yards are green and well-maintained.
For others, it may be an excuse to simply buy more and appear like they have ascended to higher levels for the sake of appearances. They want not the practical but sporty car, but the supercar (and not those entry-level supercars ), the apartment or house that costs nearly half their income, etc.
Money doesn't always mean everything, and the balance of work and life will dictate some choices (more hours needed to fulfill requirements or satisfy clients), as will expense to even work somewhere else, such as increased commuting distance (and lost time for longer commutes will dampen the family mood too).
But many times, the satisfaction of making ends meet and providing ample opportunity to actually create a safety net, actually build an investment portfolio or otherwise create a significant retirement fund... the boost in happiness and self-worth that can provide can be difficult to measure, but is otherwise directly influenced by money.
Money management is important, but life is life. Sometimes we bite off more than we can chew simply to have a safe environment (it's always cheap to live in bad neighborhoods... where you draw the line is a personal matter), and I sure as hell cannot fault someone for that. I live by that opinion myself: I'd be shot or have to constantly deal with renters insurance, and I'd like to avoid both thank you very much.