Light usage often favors pay-as-you-go APIs. Frequent, sustained workloads can justify hardware if a local model delivers the quality and speed you need. A subscription buys a capped chat product; its price does not guarantee the API workload entered below.
Starting examples: Claude Pro $20/month and Sonnet 4.6 API $3 input / $15 output per million tokens, checked October 6, 2026 (pricing). Managed-cloud rates, $1/hour GPU rental and $1,500 hardware are illustrative assumptions, not quotes. Replace them with your model, region and hardware costs.
What the calculation includes
API = input millions × input rate + output millions × output rate. Local running cost = watts ÷ 1,000 × hours × electricity price + upkeep. Local monthly equivalent spreads purchase cost minus end-of-period resale over the selected months, then adds running cost. Payback uses purchase price divided by monthly operating savings; it excludes future resale. GPU rental uses the entered hours and hourly price plus monthly extras.
This is a cost scenario, not a benchmark. The same token count does not imply the same quality, capacity or runtime. Measure your workload before buying hardware. Enter labor, storage, backups, idle time and upgrades where relevant. Taxes, financing, API caching/batch discounts, tools, extra inference tokens and usage overages are not automatically modeled. Enterprise plans may combine seats and metered usage. Cloud GPU rental is still cloud processing, not offline privacy.