Hybrid: The point is that they're getting zero. Something, anything, is better than nothing.
My take is: Single dollars add up to tens. Tens add up to hundreds. Hundreds add up to thousands........and thousands add up to ER / FI / IW.
Back to the neighbor: Were they disciplined enough (the root of the problem in his case) they'd be getting something. My local credit union, for example, also pays paltry savings rates, except the first $500, which is at 6%, so it's actually not a horrible place to park what this guy's typical refund would be, a grand or two. Plus, he's still WITHOUT any savings, for any expense that crops up beyond typical stuff. Even at zero earnings, having a wad of cash under the mattress provides a cushion for those "oh shit" one time expense financial moments.
That my neighbors can't, nay, WON'T even set aside a couple grand is indicative of the of the correctness of the original linked article - that the vast majority of this nation chooses not to save and / or invest.