“I know a guy that sleeps in the laundry room of a house that he owns. He’s renting out the available rooms just to make the mortgage payment. He makes over $100K per year at his day job.”

– This example is not representative of living standards by any stretch of the imagination. AT 100K, he could afford to rent a 3BR/2BA home in some of the nicer areas of SD @ 3000/month. Your friend is either a victim of bad circumstances (large medical bills ? divorce/alimony?) or poor financial judgment, not a low standard of living.