Catholics believe in the personal and final judgments because Christ told us we would be judged for all of our actions and that He, the Good Shepherd, would separate us like sheeps from goats, the good from the bad.
St. John of the Cross said, 'On the evening of life, we shall be judged on our love.'
All of our actions here on earth matter because we believe that we were created to spend eternity with God. Therefore the things that we do and don't do have an effect on our souls. If we don't choose God on earth, how will we be ready (or willing) to spend eternity loving Him?