I tell small lies and exaggerate constantly. It's become a habit. Is this really a big deal?

“He that speaketh truth sheweth forth righteousness: but a false witness deceit.”

Proverbs connects truthfulness to a person's fundamental character rather than treating individual lies as isolated incidents. The consistent practice of either honesty or deception forms us into a type of person. Small lies are not small in what they are making you; they are building something in your character one instance at a time.

“Lie not one to another, seeing that ye have put off the old man with his deeds; And have put on the new man, which is renewed in knowledge after the image of him that created him:”

Paul frames lying as belonging to the old self that has been discarded at conversion. Continuing to lie is, in his framework, wearing old clothes you have already taken off. The new self is being continually renewed, which means change is possible and honesty is not simply a standard to strain toward but a nature being grown into.