Can laymen ever reach Nirvana?

When this was said, the wanderer Vacchagotta asked the Blessed One: “Master Gotama, is there any householder who, without abandoning the fetter of householdership, on the dissolution of the body has made an end of suffering?”

“Vaccha, there is no householder who, without abandoning the fetter of householdership, on the dissolution of the body has made an end of suffering.”

“Master Gotama, is there any householder who, without abandoning the fetter of householdership, on the dissolution of the body has gone to heaven?”

“Vaccha, there are not only one hundred or two or three or four or five hundred, but far more householders who, without abandoning the fetter of householdership, on the dissolution of the body have gone to heaven.”

--MN 71

The idea here is that a householder would not attain enlightenment in that lifetime, but would be reborn into another life where they would attain it. Such an individual is called a "non-returner."

There is a degree of renunciation required that is simply not possible for householders and laypeople. Many modern Western Buddhists are very put-off by renunciation and believe that simply being mindful and having insight in worldly activities is enough. However, I think this is a classic example of people want to have their cake and eat it too. Gautama is very consistent and clear about the fact that one must abandon worldly pursuits and desires that necessarily arise in the life of a householder (if they didn't, one wouldn't be a householder to begin with!).

That said, there's absolutely nothing "wrong" with not wanting to go off and be a monastic. It's not a race, and there is plenty to get from Buddhism that doesn't involve becoming an arahant.

You may find this article worth reading--it is about the happiness that can be found as a layfollower of the Dhamma:

http://www.accesstoinsight.org/lib/authors/desilva/wheel337.html

/r/Buddhism Thread