Token budgets are a product-design decision
A token limit affects more than API cost. It determines how much history the system keeps, whether evidence survives into the answer, how much room remains for tool results, and when a conversation needs summarization or compaction.
Allocate the budget deliberately: system rules, current user request, recent turns, durable memory, retrieved evidence, tool output, and answer space. Reserve output capacity instead of filling the entire window with context.
When the budget is exceeded, remove low-value repetition before high-value evidence. A shorter, well-structured context usually performs better than a larger context assembled without priorities.
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