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Why This Config is Perfect for a Budget AI Server

Running LLMs (Large Language Models) usually demands massive hardware, but the combination of Ollama's efficient execution engine and DeepSeek's distilled models changes the game.

The 4GB RAM Boundary: DeepSeek-R1 has a highly efficient 1.5B parameter model (roughly 1.1GB in size). It fits completely within your 4GB RAM with room left over for your operating system.
The 2 vCPU Engine: Because we don't have a GPU, the 2 CPUs will do all the heavy lifting (CPU inference). It won't be lightning-fast, but it will easily output text at a perfectly readable human pace.
90GB Storage Freedom: Ollama models take up very little space (1GB to 5GB). With 90GB of storage, you have massive room to log conversations, build a web user interface, or store multiple different AI models to test out.

The Catch: Dealing with the Slow Response Speed

While running an AI chatbot on a budget VPS is incredibly cheap and completely private, it comes with one major downside: it can be slow. Because this setup relies entirely on 2 vCPUs instead of an expensive graphics card (GPU), the server has to do a lot of heavy math to generate every single word. The 1.5B Model: Will give you a decent, readable typing speed. The 8B Model: Will likely feel painfully slow (sometimes generating only 1 or 2 words per second) because it forces the server to use the hard drive (Swap space) for memory.

Performance Expectation

Do not expect instant replies like ChatGPT. On a dual-core CPU setup, the AI will type at a steady, human-like reading pace. It requires patience, but for a 100% private, free-to-run AI

How to Run a DeepSeek AI Chatbot on a Affordable VPS