With var you request space somewhere that can be accessed by the name that comes after it. Also this step, called variable declaration, makes sure that this space is in a certain scope. As you might remember from the exercises in Unit 3 each function can have it's own set of variables so if you declare a variable inside of a function it is only available there whereas if you declare it outside of the function (on the same level as the variable that holds the function) it is also available inside the function.
Why is this important?
And why does it work as well without using the var?
And is it recommended/necessary to use the var?
Well, what happens when you just assign a value to a variable is that you implicitly declare it to be a property of the window object. Ok, you probably don't know yet what objects and properties of objects are but what that means in this case is that it is global for the whole window. I've run a test and if you use
arbitraryName = value on one exercise you can still access this value when you switch to the next exercise. So a variable of an exercise rather long ago (unless you refresh the page which resets the variables) could do harm to your code now and the more global variables you're using the bigger the complexity becomes and the more likely you get errors from it. And these are some kind of errors that are obviously hard to track because they might have nothing to do with your exercise.
So as said with var you make sure that a variable is tied to a certain scope and even this just means that it belongs to one exercise. I hope this is enough input on why it is useful to use var. If you still have questions feel free to ask.
PS: I changed you're title hope you like it, if not just change it again.