My son respects me. At times I would say that he fears me. I think that's healthy. Not like a frightened to death kind of thing, but more like a "I better listen or I'll get a spanking" fear.
The problem is sometimes he forgets that I'm daddy. It's easy for him to remember the fun parts about daddy, that we wrestle, watch movies, go on walks, fix stuff, etc. And it's easy for him to forget the not so fun parts about daddy, mainly the discipline. So when he whines about not wanting to do something, I'll tell him that he needs to do it right now or he'll get a spanking. Then normally he'll start to do it slowly, or refuse to do it, until I get up. Then he becomes immediately compliant. He's remorseful. He's fully in line with what I want because he doesn't want a spanking.
But he forgets about that sometimes and needs to occasionally be reminded that although we can be a lot of fun, he still needs to fear me.
The same applies to our relationship with God. When things are fun and easy, we forget that God is God. Things are going great, so maybe we slip up on our favorite sin. Or maybe we don't honor God with our money. That's when it's good for God to remind us that He is God, and that we should fear Him.