Embodiments of the present invention disclose a method, system, and computer program product for cost effective data storage. A computer stores and arranges data in data storage resources in compressed or uncompressed arrangements. The computer determines what percentage of data is stored per tier for an uncompressed arrangement of data. The computer further determines both a compression factor as well as the percentage of data stored per tier for data stored in the compressed arrangement. The computer accesses data defining the cost per tier of both the compressed and uncompressed arrangement of data, then calculates the cost of both a compressed and uncompressed arrangement of the data. The computer then moves the data to the less expensive of the compressed or uncompressed arrangement of the data.