The simple fact is that IQ is distributed on a bell curve. For every person in the top 2% there is someone in the bottom 2%. Fully 8% of the US population has an IQ of 70 or lower. That's about 28 million people. People with low IQs are usually able to present themselves in a (mostly) socially appropriate way, which masks their true abilities. But the fact of the matter is that large segments of our population simply do not have the cognitive ability to make good decisions.
This article is a good long read that discusses the social effects of people on the low end of normal intelligence and the challenges they pose to society. There's a historically interesting discussion of the military's reduction in intelligence requirements during the Vietnam War (McNamara's Morons) and the science behind comparing their capabilities and experiences with their more fortunate counterparts.
https://quillette.com/2018/08/25/the-dangers-of-ignoring-cognitive-inequality/
The takeaway is that many people who act like they don't have any common sense and don't learn from their mistakes are on low low end of the bell curve and they really don't have the capacity to know better. This understanding has shaped my view of the world and has made me more tolerant of people who I previously might have been a little mean to if I thought they were being deliberately goofy. I suspect the poor neighbor falls into that category and he is fortunate to have had a good wife and neighbors who could help him.