August 18, 2020

10 approaches to control and reduce AWS costs

Cloud costs from Amazon Web Services (AWS) can add up quickly for large businesses, but there are cost management tricks & techniques you can employ to save money. The suggestions below can help with AWS cost optimization. Many of the recommendations are applicable to other cloud providers, such as Google Cloud and Microsoft Azure, too.

1. S3 versioning and EBS/RDS snapshots

AWS makes it easy to amass immense amounts of historical data, through Amazon S3 versioning, RDS snapshots and EBS Lifecycle Manager. Keeping a few backups is always a good idea, but careful planning is needed to ensure storage costs don’t grow linearly. Lifecycle policies for S3, ECR and EBS are invaluable and can also be used to change storage tiers (i.e., Glacier for S3). For more complex logic, one can configure a regularly invoked Lambda function to explicitly clean up old data. This function can also be used to replicate RDS snapshots across regions for regional resiliency.

2.General-purpose instance classes

When choosing an instance class for ElastiCache, RDS, EC2 or other AWS services, it is tempting to opt for a compute or memory-optimized variant. By and large, these are orders of magnitude more expensive than general-purposes t3.XXX sizes and aren’t needed unless you have specific requirements. AWS’ concept of burstable CPU, governed by CPU credits, works well for the majority of use cases. Using the latest generation of instance type always gets the most performance in a more cost-effective way.

3. Savings plans

Reserved Instances, whereby one makes a 1-year or 3-year commitment for a particular AWS service at a negotiated rate, have been around for a while. In their current incarnation, you can switch between instance classes easily. Savings Plans allow for a broader commitment to a collection of AWS services (namely EC2, Fargate and Lambda), providing more flexibility. Take note to only purchase any commitment as a last resort, after you have already optimized and reduced your environmental footprint as much as possible.

4. RDS multi-AZ and replicas

Enabling multi-AZ for RDS instances or adding an additional instance to an Aurora RDS cluster immediately doubles your costs. This should only be done in production environments where you need the resiliency or extra performance of a read-replica.

5. Resizing ECS task definitions

Above and beyond ECS autoscaling, where the number of tasks for a given service is adjusted using automation, consider adjusting the task definition configuration for the allocated vCPU and memory. Though there are a limited number of supported configuration permutations, lowering either vCPU or memory slightly can have large savings across multiple environments and dozens of tasks. A big advantage of using Fargate over EC2 is that one doesn’t need to worry about provisioning sufficient underlying EC2 instance capacity.

6. Share expensive services across AWS accounts

If you have multiple AWS accounts, consider joining them all to an organization. Not only does this umbrella topology make billing simpler, but it allows you to share certain services for cost-savings. Shield Advanced is priced at $3,000/month per organization and Private Certificate Authorities are $400/month but can be shared across accounts.

7. Thrashing Docker containers

If using ECS Fargate, a common unforeseen expense can be thrashing Docker containers which are failing to properly start up. The ECS service will continue to initiate a new task indefinitely. Each time, the task definition will pull the image from either ECR or Docker Hub consuming a sizeable amount of bandwidth. Over the course of a month, a single failing task can cost multiple terabytes of transfer costs. One can monitor for this with Datadog alerts or CloudWatch alarms.

8. Third-party integrations

Integrations like Datadog, Vanta and Fivetran can be overly aggressive with their sync frequency and breadth of data absorbed. This leads to high CloudWatch metric, Data Transfer and NAT Gateway charges. For each provider, ensure you have only the bare minimum of enabled features (i.e., disabling DMS in Datadog, if not using it) and a reasonable sync frequency (i.e., every 15 mins instead of every 5 mins).

9. Dovetailing services

The headline pricing for all AWS services can be deceiving. Generally priced per hour, a cost of $0.98/hour looks a lot more affordable than $729.12/month. Equations, partial hours and dimensions(i.e., LCUs on ALBs) can further complicate AWS pricing estimates.

However, the biggest hidden cost is all of the ancillary services that each AWS offering relies on. For example, using an ALB can have ‘dovetailed’ costs with CloudWatch metrics, S3 logging, DataTransfer, WAF ACLs, etc., Removing or consolidating any single AWS resource can therefore have knock-on effects to your bill.

10. Expiring credits

Many startups are fortunate enough to acquire credits with AWS, through their Ramp credit card or from the incubator they participated in. While thousands of dollars in free money is nothing to scoff at, AWS sets a finite expiry on the credits, usually 12 months later. Take a periodic look at both your remaining credit balance and the credit expiry to avoid unpleasant surprises. This can be seen under My Billing Dashboard and then Credits.

Try Ramp for free
Share with
Lewis DrummondHead of Infrastructure & DevOps, Ramp
Lewis is Head of Infrastructure at Ramp and oversees several teams. He has over twenty years of experience in architecting and deploying scalable, secure, and resilient cloud infrastructure, most often within AWS. Alongside financial services, Lewis has previously run large environments in a variety of industries, including education, fashion, healthcare, media, and technology. He lives in New York City.
Ramp is dedicated to helping businesses of all sizes make informed decisions. We adhere to strict editorial guidelines to ensure that our content meets and maintains our high standards.

When our teams need something, they usually need it right away. The more time we can save doing all those tedious tasks, the more time we can dedicate to supporting our student-athletes.

Sarah Harris

Secretary, The University of Tennessee Athletics Foundation, Inc.

How Tennessee built a championship-caliber back office with Ramp

Ramp had everything we were looking for, and even things we weren't looking for. The policy aspects, that's something I never even dreamed of that a purchasing card program could handle.

Doug Volesky

Director of Finance, City of Mount Vernon

City of Mount Vernon addresses budget constraints by blocking non-compliant spend, earning cash back with Ramp

Switching from Brex to Ramp wasn’t just a platform swap—it was a strategic upgrade that aligned with our mission to be agile, efficient, and financially savvy.

Lily Liu

CEO, Piñata

How Piñata halved its finance team’s workload after moving from Brex to Ramp

With Ramp, everything lives in one place. You can click into a vendor and see every transaction, invoice, and contract. That didn’t exist in Zip. It’s made approvals much faster because decision-makers aren’t chasing down information—they have it all at their fingertips.

Ryan Williams

Manager, Contract and Vendor Management, Advisor360°

How Advisor360° cut their intake-to-pay cycle by 50%

The ability to create flexible parameters, such as allowing bookings up to 25% above market rate, has been really good for us. Plus, having all the information within the same platform is really valuable.

Caroline Hill

Assistant Controller, Sana Benefits

How Sana Benefits improved control over T&E spend with Ramp Travel

More vendors are allowing for discounts now, because they’re seeing the quick payment. That started with Ramp—getting everyone paid on time. We’ll get a 1-2% discount for paying early. That doesn’t sound like a lot, but when you’re dealing with hundreds of millions of dollars, it does add up.

James Hardy

CFO, SAM Construction Group

How SAM Construction Group LLC gained visibility and supported scale with Ramp Procurement

We’ve simplified our workflows while improving accuracy, and we are faster in closing with the help of automation. We could not have achieved this without the solutions Ramp brought to the table.

Kaustubh Khandelwal

VP of Finance, Poshmark

How Poshmark exceeded its free cash flow goals with Ramp

I was shocked at how easy it was to set up Ramp and get our end users to adopt it. Our prior procurement platform took six months to implement, and it was a lot of labor. Ramp was so easy it was almost scary.

Michael Natsch

Procurement Manager, AIRCO

“Here to stay:” How AIRCO consolidated procurement, AP, and spend to gain control with Ramp