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I would say it's because of their consumerist culture and financial illiteracy, not because of extremely low wages.

I wonder how many of these 40% have a high end smartphone and a big LCD TV in their living room.

A lot of people are living paycheck to paycheck. Money in == money out, both by necessity and by increasing spending whenever they have increased income. Some people are deep in CC or Student debt, so extra money goes there, some are spending beyond their means (or right up to their means).

Basically, people don't or can't save (much). So any unexpected expenses need to be covered by income.

The problem isn't income, the problem is spending. People in general want more than they have. There is always another toy, A bigger widget, a better model next year.