AI Pricing Explained: Tokens, Credits, and Real Costs
June 21, 2026 · 7 min read
Token math is simple once you see it, and it prevents nasty surprises at scale.
Tokens
Roughly four characters per token. Input and output are usually priced differently.
Context is expensive
Resending a long history every turn multiplies cost fast; summarize aggressively.
Caching
Prompt caching and reuse can cut bills by half on repetitive workloads.
Model tiering
Route easy requests to small models and escalate only when needed.