You guys are awesome!
I'm realizing that part of our problem is that we are still unsure of what we want exactly, in terms of becoming FI and retirement, and where/how long we actually want to live somewhere.
To provide a few more details: husband owns a business that he enjoys watching grow. He built it from scratch and has expanded to three stores. I'm pretty sure it offers him challenge and stimulation, so retirement in the traditional sense is not what he wants just yet (he's 35). If he sold the business he'd likely want to just start up another one, regardless of whether or not we needed the income. I do actually work outside the house, but I'm a flight attendant so I only make the trek to the airport and back once a week (and it's an hour drive from the "far" location, half hour from the "closer" location). In addition to the income, my job provides our family health insurance and free flight bennies, so regardless of income I'll probably never retire but just cut back on what I fly. These are the reasons why we're a bit uncertain of retirement goals.
What we are sure of though, is that we would like to live so far below our means that we pay off everything (credit cards, student loans, future mortgage - we're currently renting) and don't NEED to work, but rather choose to.
Which is why we were questioning cheaper house/far commute vs. expensive house/short commute. We tend to not be people who have 10 year plans or know where we want to live "forever" (that's a hell of a long time). If we get the cheaper house/far commute, we could pay it off asap, and if we want to move, we could rent it out for pure profit in the future. But if we get the expensive house/short commute we gain profit immediately in less gas, car expense, time, etc, but twice as long to pay off.
Our daughter is 3, so where we decide to set roots is likely where she'll spend at least her elementary school years. And as far as "good schools" in Chicago Proper, yes, they exist, but they're often magnet or charter schools that require testing that puts college admissions tests to shame. 5 years old is a bit young to have the stress of "getting into a good school."
We definitely have some calculations to do to determine the true cost of each location, over the length of at least our daughter elementary years. Thank you for each of your bits of information! It's been incredibly helpful!
(I hope I addressed all those questions)