# 5 ways to optimize AI costs and reduce wasted AI spend

DevFeed: [5 ways to optimize AI costs and reduce wasted AI spend](<https://devfeed.tech/articles/5-ways-to-optimize-ai-costs-and-reduce-wasted-ai-spend-1889.md>)

Original publisher: [Read original article](<https://1password.com/blog/5-ways-to-optimize-ai-costs>)

Author: info@1password.com (Rachel Sudbeck)

Published: 2026-09-03T00:00:00Z

Content type: article

Language: en

Sources: [Blog on 1Password Blog](<https://devfeed.tech/sources/blog-on-1password-blog.md>)

Topics: [Artificial Intelligence](<https://devfeed.tech/topics/ai.md>), [cursor](<https://devfeed.tech/topics/cursor.md>)

Tags: [ai](<https://devfeed.tech/tags/ai.md>), [ai-agents](<https://devfeed.tech/tags/ai-agents.md>), [ai-models](<https://devfeed.tech/tags/ai-models.md>), [cost](<https://devfeed.tech/tags/cost.md>), [cursor](<https://devfeed.tech/tags/cursor.md>), [saas-management](<https://devfeed.tech/tags/saas-management.md>), [shadow-ai](<https://devfeed.tech/tags/shadow-ai.md>), [unified-access](<https://devfeed.tech/tags/unified-access.md>)

## AI overview

The article outlines ways businesses can reduce AI spending, including choosing less expensive models, overseeing AI agents, and identifying shadow AI.

## Source excerpt

The tokenmaxxing era has left companies grappling with an uncomfortable reality. Now that AI vendors have switched to usage-based billing models, businesses are facing sky-high bills, and IT and finance teams are under pressure to rein in spending without slowing down innovation. The logical first step is to locate areas where that spend is going to waste, but even getting visibility into usage can be overwhelming when it's spread across departments, users, models, vendors, and agents. If you're trying to track down wasted AI spend and find opportunities to optimize your tokens, it helps to start with some of the primary reasons why AI bills may balloon past your company's budget. Top ways to optimize your company's AI costs So IT and Finance teams can know where to focus their efforts, here are five of the most common sources of unexpected AI spend. 1. Stop defaulting to the most expensive model For businesses to optimize spend, they need a way of overseeing and enforcing which models are being used for what tasks. Different AI models can vary wildly both in their abilities and their cost, and many users default to flagship AI models without realizing that there are more affordable options that can accomplish their goals at a fraction of the cost. For instance, in a recent experiment run by Cursor, building a web browser from scratch cost $10,565 when using a top-tier flagship model, and $1,339 when using a mix of models, even though the end results were comparable in terms of quality. 2. Stop letting agents run without oversight As the Stanford Digital Economy Lab reported, AI agents are "uniquely expensive, consuming 1000x more tokens than code reasoning and code chat." Meanwhile, data from OpenRouter shows that the majority of tokens spent overall are being used by agents. Here's a scenario that's becoming familiar to many AI developers and builders: An agent is instructed to perform a certain task, but it fails. So it tries again, and fails. With each loop, it