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That sounds like a plan. But I've found good SSDs that are around the $80 US for 128 GB. Which is more than enough to handle a FTB server running linux. The 1TB drive could still be used for scheduled backups. I know I use cron on my server to back it up every 6 hours.
So turns out that mega CPU still causes lag when loading chunks as you said. So when looking for an SSD is there anything specific I should be looking for on it?
Go with a reliable one that gets a lot of good reviews. Personally I've used a lot of the Samsung Evo 850 SSD and never had any issues. But, I've also used Kingston and a few other as well.
If you want to go overboard get a RAID controller and go with multiple SSD in RAID 0.
lag will never go away when generating chunks no matter how much single thread performance you throw at it, especially when using biomes o plenty or other mods that enhance world gen
thats why most server pregenerate their map