Stop Guessing: Calculate Your Local Index Token Savings

A local index is a pre-built, searchable knowledge base (often using embeddings or keyword search) that runs on your own infrastructure. Instead of calling an external tool or API for every query, the LLM first checks the local index. If a relevant answer is found (a 'hit'), the tool call is skipped, saving tokens and latency.

The calculator multiplies your daily tool calls by the average tokens per call to get total daily tokens. It then applies the local index hit rate to estimate how many of those calls are avoided. The avoided tokens are converted to cost using your model price per 1K tokens, and multiplied by working days per month for monthly savings.

Hit rate depends on your domain, index quality, and query patterns. Start with a conservative estimate (e.g., 0.5) and adjust upward as you measure real performance. The calculator lets you test multiple scenarios instantly.

No, this calculator focuses on token and API cost savings from avoided tool calls. You should separately consider infrastructure, embedding, and maintenance costs. However, for many teams, the token savings alone justify the investment.