Aren't two issues being conflated here? (1) Securing access to your wi-fi with a password so that your neighbor can't free-ride on your ISP and (2) Encrypting your wi-fi traffic so that your neighbor (or Google) can't spy on you.
Conceptually, yes, these are two different issues. But since wifi security pretty much requires encryption of the traffic (otherwise anyone could just sniff your credentials during the access negotiation), and encryption requires some sort of access control anyway, they always go together in practice.