Looking at my companies parking lot, I see BMWs, Mercedes, Range Rovers, Escalades, Maserati, Porsches, and tons of new cars, etc I'm in Detroit of all places. We're not getting paid like that!
Most people have new iphones, ear pods, the other day I was in a meeting with about 12 people, 9 of them where wearing iwatch. I can assure you that for the majority it's a fashion statement more than a need.
You can "buy" that explanation or not, but there's a lot of research and evidence backing up the idea that a huge fraction of the western world lives essentially paycheck to paycheck, and it's not because all of them are less financially savvy than you or I, who just happen to get paid well above average too.
A good TV and nice phone are not usually the kind of expenses that drive people into having no savings. If I go grab an example from t-mobile...
A brand new, shiny iphone x for somebody with good credit is gonna run us $30/m. That's kinda pricy, so let's go a few generations back and get a refurbished iphone 6s plus - they won't let me go to older generations. That'll cost $22/m. So sure, yes, that cost adds up - but $8/m extra in savings is not going to be the difference between somebody living paycheck to paycheck or suddenly being flush with savings.
Never mind reality TV - _actual_ reality is that a large percentage of the population of basically every first world, western, developed country is paid at such a level that any raise is just going to go directly back into the economy because they aren't paid enough for savings to be a high enough priority to happen. This isn't financial illiteracy - both of us put a _lot_ before savings, it just happens that once we've done that we still have a bunch left over. Lots of people don't.
Of course that $8/month difference isn't much savings, but it is a lunch out vs heating leftovers one day. Or you can eat leftovers everyday, save that $8/month on the phone and use all of that savings to buy membership at a golf club. This is your life and your choice, what do you want?
People don't live paycheck to paycheck by choice, usually. Savings first is not an option if it means not paying rent, bills, or food.
How much savings you need is an open question of course. To live as above without income doesn't require a lot of savings, so you start saving less and add some luxury.
Placing your wants in check does wonders to keep cash in your pocket. If some people burn through their cash to feed their conspicuous consumption then obviously that doesn't mean they are poor or in need.