That piece of the puzzle is systemic, but it has a personal side as well, overlooked by people who claim things like the avocado toast guy is right. Humans need an escape valve to relieve stress without going crazy. In today's society, these escape valves cost money; so people do need to spend some money on a little affordable luxury, whether it's going to the movies, playing video games or indulging in a tasty food.

Perhaps in the past the destitute poor could find some free escape valves to this end, but modern urban society limits access to the social interactions and natural resources that made them possible.

It is a fallacy to suppose that living a monastic life would save enough money to get out of this extreme situation. Even discounting the mental imbalance it would cause, if your income is so limited, the meager savings of suppressing these small luxuries would not radically change your financial situation.