(Before I start, I should add that I have Twallan's NRaas story progession mod, if that makes a difference.)

So recently I had two ladies in my Sim family, Arya and Devon. They grew up, Devon had babies and got married, and then moved out. A couple sim-days after she moved out I very briefly (like, for 5 Sim minutes) made her my active family to plant the seeds I left in her inventory and just see how her family was doing.
It was bad.
All three babies were yellow in mood, Devon's sleep meter was red but she had just standing there for hours, her husband was making a random meal when he didn't have a low hunger (instead of taking care of his triplets), and the kid was sleeping with its homework undone when before it was just standing around for hours as well.
No wonder my town is full of Sims who have like half a good trait! Everyone sucks at taking care of themselves and ignore their children!

Is this a problem other people have in their towns as well? Do you find the other Sims in your town are slacking at basic life needs?

I generally like playing the town versus just paying attention to my own family, so this is really bothering me. I don't have any free will on, would that affect anything?

Thanks in advance for any other stories or helpful tidbits :3

Yes. With free will on, sims will actually live lives, and take care of other things, besides themselves. Without it, sims only take care of their own needs, should they fall to dangerous levels. Although I don't know how this affects inactive sims, I assume the principle is the same.

My impression is that they kind of work like tamagochi. Sometimes you need to make them do certain chores a few times and then they start doing it on their own after a while (unless other needs are very low). An example is making their bed or cleaning up dishes after eating (for sims without Neat trait). This also goes for homework. To improve it further you could use a mod to change some traits if needed. Ive noticed that Disciplined sims go to bed on time and Neat sims clean up of course. You could have a free will household that stays clean with just one sim that has the neat trait.

I always use max free will and usually focus only on one sim in a household. This way the other sims cause fun surprises. I rarely have sims doing the same thing over and over anymore. There are a few items that cause problems without mods though. Musical instruments attract all sims even if they need to fill a different low need (like sleep/bathroom/hunger). Same goes for skinnydipping/dancing Party sims. These kinds of behaviour are way too disruptive in vanilla mode. I used to delete instruments wherever I found them before I had a mod that lowers the attraction of instruments It became too annoying seeing all sims interrupt whatever they were doing because one sim started to play an instrument.

Having free will turned off would suck all fun out of the game for me.

free will on does help...and i have noticed since generations....i find even more kids around town doing their homework at the park or wherever....i like it this way...

My first Sunset Valley game was a lot like what you describe - the non-active sims seldom went to work, seldom took care of their spawn babies and when the babies became children they never went to school. And then there was an overabundance of sims with negative traits. I actually didn't dislike that town - it was a strange, dark place.
I also have Twallan's Story Progression and I don't notice anymore that the non-active sims are especially unmotivated. They don't stay in their houses very much. The usual complaint is that when you check in on sims you haven't played in a while, they've gone off and done a lot of random things. contrary to what you had planned for them.

Thanks, guys For the record I understand that free will effects all my family, I was wondering how it affected sims that aren't active.

I think I'll keep free will on high and see what happens

That's a way of playing I never thought of Good idea! I guess I'm just a control freak, haha. I like knowing what my family is doing and making sure they aren't wasting time / not taking care of themselves / etc. And good call on the instruments... I've noticed that too and it's annoying!

I used to ip my hair ou because of that. My sims would just stand there and do nithing, waiting for death. After I instaled Awesomemod, things got better, I think. But still, I switch families like a regularplayer switch a sim, so I'm always keeping everyone happy.

For me personally, as long as my active sims are doing OK then that's all that matters. It's too much trouble to be worrying about how the none active households are coping. As long as they aren't killing themselves then that's ok with me .
For example I recently switched households to check on my legacy spare and was shocked at the conditions I found her living in.
Grace had got pregnant as a teen but still managed to graduate as Valedictorian, in a stable and happy relationship with her baby's father. So as soon as she was a young adult I moved her out, figuring she'd manage fine on her own.
When I went to check on her I was surprised to find her living in that crappy supershack house with no money and no job. Her now toddler son had no crib or toys and was sleeping on the bathroom floor. She'd somehow married and divorced the father of her child without me noticing. When I checked his relationship panel I saw the reason why - he'd knocked up Grace's BFF! And worse still, Grace was pregnant again herself with her loser ex-husband's second kid. All of their moods were right down in the red.
When I went back to playing my main family, I recieved a notification saying that Grace had now married an old man. Creepily it was the guy who used to babysit her. Days later she was pregnant by him...Needless to say that all of Grace's children are flunking school and have grown up with useless traits like 'light sleeper'. I guess if I made her family my active household I could sort her crappy life out but honestly I quite like the fact that she's miserable . I don't want all my sims to happy and perfect and it's hard enough maintaining the moods of my active sims alone without worrying about the rest of the households. It makes the neighbourhood more interesting too.

If you're sick of sims growing up with useless traits then you can always change them using Master Controller, that's what I do.
I also had my rich sim put loads of toys in her inventory to give away as gifts to her poor grandchildren (they all seem to become poor when they leave home ), that way I know that the child has at least one toy to play with.