"So what do you say to the person that ignores this, spends every penny they earn and lives beyond their means so they can't make rent or pay for basic necessities as soon as the tiniest problem arises?"
You're assuming people have enough left over to squirrel away. That isn't true for many people. They're literally living paycheck-to-paycheck (if not day-to-day) because they can't ask for more out of the market without being turned down (the only thing worse than a penny pay is NO pay), and what they get is barely (or NOT) enough to accommodate even a Spartan living. It's tough to squirrel away when you're not even making the Cost of Living and can't negotiate for higher.