AWS Cost Optimization Best Practices: Maximizing Cloud Value

Nov 14, 2023

Amazon Web Services (AWS) is the world’s leading cloud computing platform, offering a plethora of services that cater to various business needs. As businesses scale, managing AWS costs becomes paramount. This article discusses the best practices for AWS cost optimization, ensuring you get the most out of your AWS investment.

Introduction to AWS Cost Management

The dynamic nature of cloud resources can make costs unpredictable and challenging to manage. Factors contributing to high AWS costs include:

  • Under-utilized compute instances.
  • Unused resources like EBS volumes, snapshots, and load balancers.
  • Not leveraging discounted instance types like Spot or Reserved Instances.
  • Not utilizing Savings Plans which offer significant discounts.
  • Inefficient auto-scaling configurations.

Understanding these factors is the first step in optimizing your AWS costs. Let’s dive deeper into the strategies and best practices that can help you manage and reduce these costs.

Pillars of AWS Cost Optimization


Ensure that the resources you provision align with your requirements. This includes CPU, storage, network throughput, and memory. Over-provisioning can lead to unnecessary costs, while under-provisioning can affect performance.


Traditional IT hardware is rarely turned off. However, the cloud model allows for dynamic resource allocation, enabling you to turn off resources when not in use, thus saving costs.

Choosing the Right Pricing Model

AWS offers various pricing models, including on-demand, Spot Instances, and Reserved Instances. Select the one that aligns with your workload’s needs and budget.

Storage Optimization

AWS provides different storage tiers with varying performance and costs. Choose the right storage type based on your data’s access needs and frequency.

Continuous Monitoring and Improvement

Cloud environments are ever-changing. Establish regular monitoring and review mechanisms to ensure continuous cost optimization. Utilize tools like AWS Cost Explorer and third-party solutions to gain insights into your spending patterns.

AWS Cost Optimization Best Practices

1. Choose the Appropriate AWS Region

The AWS region you select affects costs, latency, and availability. Consider factors like pricing differences between regions, latency requirements, service availability in the region, and data sovereignty laws. For instance, data storage costs might be lower in one region compared to another, but regulatory requirements might dictate where sensitive data can be stored.

2. Schedule Unused Instances

Instances that run 24/7 can quickly rack up costs. Turn off unused instances during non-working hours or when not in use. Use tools like AWS Instance Scheduler to automate this process, ensuring that you only pay for what you use.

3. Identify Under-Utilized EC2 Instances

Regularly review your EC2 instances to identify any that are under-utilized. Consider resizing, stopping, or terminating these instances. AWS Cost Explorer can provide insights into instance utilization, helping you make informed decisions.

4. Optimize EC2 Auto Scaling Groups (ASG)

ASGs allow dynamic scaling of EC2 instances based on demand. Ensure that your scaling policies are optimized to avoid over-provisioning or under-provisioning resources. Regularly review and adjust these policies based on actual workload requirements.

5. Manage Reserved Instances Efficiently

Reserved Instances (RIs) offer significant discounts but require a long-term commitment. Regularly review your RI utilization and consider selling unused RIs on the AWS RI Marketplace or converting them to suit changing workloads.

6. Utilize Compute Savings Plans

Savings Plans offer flexibility and savings. Regularly review your commitments and adjust them based on changing workloads to ensure you maximize your savings.

7. Monitor Storage and Delete Unused EBS Volumes

Regularly review your storage usage. Delete unused EBS volumes and snapshots to free up space and reduce costs. Consider automating this process using AWS Lambda functions.

8. Optimize Load Balancers and Bandwidth Use

Idle load balancers can incur unnecessary costs. Regularly review your Elastic Load Balancing configuration and remove any idle or under-utilized load balancers. Also, consider using Amazon CloudFront to cache content and reduce data transfer costs.

9. Implement Internal Chargebacks

Use tools like the AWS Enterprise Billing Console to allocate costs across departments or business units. This promotes accountability and encourages cost-saving behaviours across the organization.

10. Automate Cost Optimization

Consider using third-party tools like Spot by NetApp to automate various cost optimization processes. Automation ensures that you’re always using the most cost-effective resources without manual intervention.


Optimizing AWS costs is an ongoing process that requires a strategic approach, regular monitoring, and timely action. By implementing the best practices mentioned above, businesses can ensure efficient use of AWS resources and achieve significant cost savings. For a comprehensive AWS cost optimization review and tailored solutions, visit Cloudvisor’s AWS Cost Optimization Review.

Ready to save on your AWS costs?
Book a free consultation with one of our team members today!

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