Let’s make AWS Cloud cost optimised by utilising these tools

AWS provides several tools for cost optimization that help reduce our bills. Let’s explore these tools together.

• AWS Cost Explorer
• AWS Budgets
• Amazon CloudWatch

1. AWS Cost Explorer:

Cost Explorer allows users to visualize, understand, and manage their AWS spending. It can also predict how much we might spend in the future, and point out any unusual spending patterns.

It offers visualizations and interactive graphs that allow users to view data by service, linked account, region, usage type, and more.

Users can forecast their future AWS costs based on historical usage patterns. it predicts the next three months' billing in advance it helps to plan and manage budgets

Cost and Usage Reports: AWS Cost Explorer offers detailed reports that provide insights into AWS costs and usage. Users can generate customized reports to analyze spending trends, identify cost drivers, and track usage patterns across different AWS services.

AWS Cost Explorer supports cost allocation tags, allowing users to categorize and allocate costs to specific departments, projects, or teams within their organization.

Let's see Cost Explorer on the console

Go to the AWS Management Console and navigate to the Billing and Cost Management service

In the CloudWatch console, choose “Cost Explorer” from the left-hand menu

2. AWS Budgets

AWS Budgets is a service that helps users set custom cost and usage budgets for their AWS resources. We can monitor AWS expenses and usage with this tool to make sure they stay within the allocated budget. Here’s why AWS Budgets is used and its key features:

AWS Budgets provides a detailed record of AWS costs and usage. It enables users to track spending across various AWS services, such as EC2 instances, S3 storage, RDS databases, and more.

We can create custom budgets based on specific requirements. For example, set monthly, quarterly, or annual budgets for various AWS services or accounts.

Using AWS Budgets set up alerts to notify when spending is more than or forecasted to exceed defined budget thresholds. These alerts can be sent over email, Amazon SNS or AWS Lambda functions.

The service provides forecasted cost estimates based on past usage patterns, helping plan and manage AWS spending more effectively also We have the option to create multiple budgets, such as monitoring expenses for different departments, projects, or environments.

Create a Budget for the AWS account

Go to the AWS Management Console and navigate to the Billing and Cost Management service

Choose Budget Type:

Go to Budgets >> Create budget >> Budget setup (customize advance) >> Cost budget >> Next >>

Configure Budget Details:

Set budget >> Budget name >> period >> monthly >> Budgeting method >> enter budgeted amount >> keep default Budget scope

Configure Budget alerts and Add alert threshold:

Set alert threshold, threshold: put value 75

Notification preferences Email recipients: provide mail Id

Next >> Next

Review >> Create budget

3. Create Amazon CloudWatch Alarms

Amazon CloudWatch collects and tracks metrics, monitors log files, sets alarms, and automatically reacts to changes in AWS resources.

It collects data about how resources are performing, monitors logs for any issues, sends alerts if something isn’t right, and can even take action automatically based on certain conditions.

Go to the AWS Management Console and navigate to the CloudWatch service.

In the CloudWatch console, choose “Alarms” from the left-hand menu.

Click on the “Create Alarm” button.

Choose the “Billing” metric namespace.

Select the specific metric we want to monitor, such as “EstimatedCharges”.

Configure the threshold for the alarm based on cost optimization goals. For example, might

set a threshold that triggers an alarm if spending exceeds a certain amount.

Specify the actions to take when the alarm is triggered, such as sending notifications by Email.
here I mention “Create new topic” so a new SNS topic will created.

Conclusion:

By using AWS Cost Explorer, AWS Budgets, and Amazon CloudWatch, users can get insights on their AWS spending, set budgets and alerts to monitor costs effectively and take proactive measures to optimize resource utilization and reduce bills. These tools provide a comprehensive approach to cost management and assist organizations in making informed decisions to achieve cost efficiency in their AWS environment.