Earth has a magnetic field because the core of the earth is made of ~~liquid~~ iron, with a solid iron inner core surrounded by a liquid iron outer core. Iron is magnetic, so much so that we call things that are attracted to magnets “ferromagnetic”, from the Latin word “ferrum” which means iron. The magnetic field of earth is important because without it life would not be possible. The Earth is constantly being bombarded with powerful radiation and charged particles from the sun and from outerspace, all of which are very deadly to living organisms. But, these particles get trapped in Earth’s magnetic field, where the are harmlessly moved towards the poles. Instead of killing you, they put on the brilliant light shows called the auroras: Aurora Borealis & Aurora Australis
Bonus edit: magnetic fields are thought to be so vital to the development of life itself that many scientist consider a metal core to be a necessary component of any planet potentially fostering extraterrestrial life.
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