The first step to cutting your generative AI cost is switching from any monthly subscription to a pay-as-you-go model using the OpenAI API. The rest of this blog post assumes you’ve already made this step!

To effectively utilize OpenAI’s APIs while monitoring your expenses, it’s essential to find the perfect balance between utilizing AI’s robust features and staying within your budget. Here are the important steps to take.

How Much can I expect to Spend?

In contrast to subscription-based models, the use of FlexChat.ai and the Open AI’s Chat API allows you to pay-as-you-go, which means you pay as a little as a fraction of a penny as you use the Open AI API.  This model also increases your privacy as chats are only between your computer and Open AI, and never shared with any third party.

As you use FlexChat.ai, OpenAI will bill your credit card based on your usage. The cost of the API depends heavily on the model you use and how much text you send and receive but here’s a couple of examples:

• If you’re using the gpt-3.5-turbo model and submit 1/2 page of single-space instructions to ChatGPT, and obtain a page of response text, that interaction would cost $0.0025 (1/4 of a penny). Note that the Simple Chat, Expand Text, and Summarize text all use this very capable and inexpensive model and, by default, Conversations use this model as well.
• If you need the new/enhanced capabilities of the gpt-4 model in your Conversation, that same exchange would cost about $0.05.
• DALL-E 2 images cost about $0.02 & DALLE-3 images cost can cost $0.04 to $0.12.

See https://openai.com/pricing for more information.

Set Up Billing and Control Expenses

Billing Dashboard – Start by visiting the Billing settings page on OpenAI’s site. This dashboard is your central hub for all billing activities.

Set an E-Mail Notification Threshold – Setting up budget alerts is a wise strategy to keep you apprised as you approach your designated spending limit.

Set a Monthly Budget – Establish automatic expense limits to cap API use once a specific monetary limit is hit, effectively preventing any billing surprises.

Monitor API Usage

To keep tabs on API usage, check out your Usage Dashboard. It offers a comprehensive breakdown of your API use over time. Get to know the key indicators, such as token consumption, number of API calls, and associated charges, to discern cost origins.

Strategies to Reduce Expenses

Understand Model Tiers and Costs

When diving into the expansive world of OpenAI’s APIs, it’s important to note that not all AI models are created equal—especially when it comes to cost. Different models offer varying levels of complexity and capabilities, which can impact your budget differently.

For the latest model and cost information go to https://openai.com/pricing.

Here’s how to ensure you’re choosing the right model for both your technical needs and your wallet:

Assess Model Types – OpenAI provides a range of models, from simpler ones suitable for basic tasks, to more advanced models that can handle complex requests. The more sophisticated the model, the higher the cost per API call or token usage may be.

Performance vs. Cost – Evaluate whether you need a high-performance model for your application or if a lower-tier model might suffice. Sometimes, smaller models can deliver the results you need at a fraction of the cost.

Model-Specific Pricing – Familiarize yourself with the pricing structure for each model. OpenAI typically outlines the cost-per-token for each API, which can help you predict expenses based on your expected usage.

Strategically Select Models to Optimize Costs

Trial and Error – Use the FlexChat.ai Settings to experiment with different models. Start with less expensive models to see if they meet your needs before moving on to more costly ones. This can help you avoid overspending on higher-tier models that might be more than necessary for your use case.

Model Evaluations – Regularly assess the performance of the model you’re using. If you’re not seeing a significant benefit from a higher-tier model, switch to a more cost-effective option.

Tailored Approach – Sometimes, a combination of models may be the most cost-effective strategy. Use advanced models for tasks that require them, but don’t overuse them for simpler, more routine processes.

Token Efficiency within FlexChat.ai

Learn how tokens function and refine your requests for their economical use. https://openai.com/pricing shows pricing relative to tokens. Basically, the more information you send to OpenAI and receive from OpenAI, the higher your costs.

• Selectively delete text from your conversations
• Remove entire Exchanges (specific User/Assistant exchanges)
• Move text out of your Conversation and into your Document
• Modify text directly rather than asking ChatGPT to rephrase its respones
• Use the Summarize Text tool to summarize a large block of text down to a more focused message

See our FlexChat Ribbon help for more information.

Final Thoughts

Stay Updated – Keep abreast of pricing changes and any modifications to OpenAI’s policies at Openai.com.

Documentation – For an in-depth understanding of API management and optimization, delve into OpenAI’s documentation.

Community Engagement – Engage with the OpenAI community forums to exchange pointers with fellow users. Proper management of your OpenAI API involvement is about being proactive and well-informed. With these systems and techniques in place, you can exploit the strengths of AI and maintain financial control. Continuous review and a solid grasp on your consumption patterns are pivotal for an economical and proficient AI operation.