AWS Budgets

The AWS Budgets service that falls under the umbrella of the AWS Billing and Cost Management service can be used for the purpose of setting budgets for our AWS account or organizaton.

Introduction to AWS Budgets

AWS Budgets helps us better plan and control our costs for our AWS account by setting flexible budgets and forecasting future costs. With AWS Budgets, we can maintain control over the AWS costs and usage, ensuring that we stay within our financial plans and avoid unexpected charges.

We can create budgets according to a timeframe best suited to our organization, which can be weekly, monthly, or yearly.

Here are some key aspects of the AWS Budgets service:

• Custom budgets: We can create custom budgets based on different metrics like costs and usage using AWS Budgets. We can tailor these budgets to our specific needs, like tracking costs for a particular service or resource that traditionally incurs high costs.

• Alerts: AWS Budgets allows us to set up alerts that notify the relevant individuals when the budgeted cost limits exceeds. These notifications are sent either via email or Amazon Simple Notification Service (SNS). This feature helps us to proactively manage costs and avoid additional charges.

• Cost and usage tracking: We can track the actual and forecasted AWS costs and compare their usage against the budgeted amounts. This helps in identifying trends and making informed decisions.

• Reporting: We can have AWS Budgets generate and send detailed reports that provide insights into their spending patterns on a scheduled basis. This can help identify areas for cost optimization.

• Integration with AWS Cost Explorer: We can integrate AWS Budgets with the AWS Cost Explorer service, which allows for a more detailed analysis and visualization of our AWS account’s spending and usage data.

Budget types

There are four different budget types we can choose from to create a budget:

• Cost budget: This budget type monitors cost against a specified amount. We use it when we want to budget according to how much we can spend on AWS services. This is the budget type that’s recommended by AWS to use.

• Usage budget: This budget type monitors the usage of a service based on the usage type we specified for it. We use it when we want to budget according to how much we use AWS services.

• Savings Plans budget: This budget type monitors the usage or coverage associated with a Savings Plan.

  • When monitoring the usage of a Savings Plan, we check the instance usage covered by the Savings Plan.

  • When monitoring the coverage of a Savings Plan, we check if the Savings Plan is unused or underutilized.

• Reservation budget: This budget type monitors the usage or coverage associated with the Reserved Instances (RIs)Reserved Instances (RIs) are a billing option in AWS that provide a significant discount compared to on-demand pricing in exchange for committing to a specified level of usage for a fixed term..

  • When monitoring the usage of a reservation, we check the instance usage covered by the reservation.

  • When monitoring the coverage of a reservation, we check if the reservation is unused or underutilized.

Setting up AWS Budgets

Using AWS Budgets is relatively quite simple and can be accessed through the AWS Management Console, AWS CLI, and AWS SDKs. Here’s how we can set up a budget on AWS Budgets:

1. When creating a budget, we first need to specify the budget type we want to set. Alternatively, we can choose an AWS-defined template instead for a quicker and simple setup.

2. We then need to define the budget name and relevant budgeted threshold, like the cost limit, that we budget to keep under. We can also define the scope of our budget, meaning whether we want to set a budget for all AWS services or just a specific few.

3. We can then set up alerts and specify any email addresses to which we’ll send notifications whenever the budgeted threshold is crossed.

4. Optionally, we can also set up budget actions that perform a certain action whenever the budgeted threshold is crossed.

Use cases

Here are some use cases of the AWS Budgets service:

• Set budgets to plan and set expectations for cloud costs incurred by our AWS resources.

• Generate scheduled budget reports to monitor actual against forecasted and budgeted costs.

• Monitor the usage and costs of AWS resources with support for filters.

• Set automated alerts and actions when the actual costs exceed the budgeted threshold.

Understanding costs

Here are the key points to understand the costs associated with AWS Budgets:

• AWS Budget: AWS Budget itself has no cost associated with it. We can set and monitor budgets as well as receive notifications regarding budgets at no additional cost. It’s important to note that we’ll still incur costs for the resources for which we’re setting the budget.

• AWS Budget reports: Each AWS Budget report we receive will incur the same fixed cost, irrespective of whether the report is scheduled on a daily, weekly, or monthly basis.

This lesson taught us about creating budgets to control costs on our AWS account, setting alerts that get triggered when costs exceed the budget, and generating budget reports to monitor the performance of our set budgets.