Memory management is a complex topic. It's analogous to desk space at a workspace/office, it is much more noticeable when you don't have enough than it is when you have a surplus. It is in your Mac's best interest (for performance) to try to utilize as much RAM as it can out of the RAM that is available, so it is not uncommon to see workloads use a surprisingly large amount of memory when there is a surplus of available RAM.
Out of everything you'll have in RAM, there are basically three categories:
1) Stuff that is actively being used (and should stay in RAM, the CPU needs it and needs it often)
2) Stuff that programs allocated, but isn't being used very often. This is what Mac OS starts with when it begins to swap/compress memory. (Think code for menus or sections of an app that you never went through, or tabs in a browser that you haven't visited for hours. Quite a lot of memory typically falls under this category and can be swapped very easily with almost no negative impact to performance).
3) Cached data (stuff that isn't actually needed, Mac OS keeps it in free memory "just in case").
Mac OS' activity monitor shows you how much data is actually cached, so you'll see how much memory falls under categories 1 and 2 together under "memory used" and then cached memory separately. What Activity Monitor doesn't show you is a breakdown of how much memory is actually being actively used vs. data that is infrequently accessed. It might show 7GB of memory "in use" - but this doesn't actually give you a good idea of how much of that is actually important to keep in RAM for performance. Much of that might very well be very inactive memory that can easily be swapped with virtually no negative impact to performance (especially on newer versions of Mac OS, where the OS itself and its services tend to be very happy to allocate larger amounts of memory)
Memory pressure is the best way to really reliably get an idea on Activity Monitor. if it's in the green, you have plenty of free memory (regardless of how much is "in use" by the numbers). Yellow means that Mac OS has begun to swap and/or compress more of your memory, but that it still has enough RAM to keep your actual actively used data in RAM (and thus there is usually a fairly minimal impact to performance). Red is when your Mac is actually running out of RAM. If your pressure graph is in the red, Mac OS is swapping and/or compressing important stuff (and this is when your computer starts to grind to a halt and feel like it's a tabletop box from the 90s).
In my experience, Monterey has used more RAM than previous versions of Mac OS, but it doesn't seem to have any noticeable affect on memory pressure once the Mac is actually put under heavier workloads. The OS is happy to allocate large amounts of RAM, but this doesn't mean that it's actually actively being used. Mac OS simply starts swapping out what hasn't been accessed for a while, which frees up memory for your actual workloads. My Catalina and Monterey macs both perform about the same under load (Monterey actually performs a little better in some cases), so I wouldn't worry about it too much as long as your memory pressure isn't in the red.