8 Proven Ways to Reduce Your AWS EC2 Costs

AWS is everywhere and many organizations are leveraging it’s power. But with the power of AWS comes the EC2 cost which is undoubtedly a big component of your cloud payment.
AWS is everywhere and many organizations are leveraging it’s power. But with the power of AWS comes the EC2 cost which is undoubtedly a big component of your cloud payment. Understanding how to reduce EC2 costs is important. It’s a fact that most new startups fail to launch their business because of poor financial management. Understanding the AWS billing cycle and how it ticks is key in ensuring that your AWS EC2 costs are as low as possible. In this post, you will learn about EC2 and recommend practical solutions to lower EC2 expenses without affecting your operations.




Here are 8 Proven Ways to reduce your EC2 costs:

Decide on EC2, ECS , Fargate Or Serverless Archictecture

Instances that can fulfill your applications’ and workloads’ needs. You can do this by evaluating your computing demands. Memory, network, SSD storage, CPU architecture, and CPU count are all factors to consider. Once you have this information, you should seek an instance that offers the greatest performance for the amount you are willing to pay. It is not hard to discover low-cost cloud instances based on your requirements. We can use serverless architecture if the REST service or deployment does not rely on the existence of running machines and can be an event driven architecture. We can also set up ECS or Fargate machines with the right size, memory, and storage to scale up or down depending on your needs.



You can save licensing cost with predefined or bulk license management.

Leverage reserved instances

Reserved Instances are a way to buy EC2 machines for a long term and reduce overall pricing through an agreed discount. Since a reserved instance is a pre-paid model, Amazon offers a 75 percent drop on the hourly pricing per instance. As a result, the entry-level instance will cost less. The availability of the reserved instance model is likewise higher than that of the on-demand instance. Why? In a nutshell, it’s because it’s prepaid. As a result, it is pre-booked, allowing Amazon to schedule the time required. Finally, users can sign up for a one-year or three-year commitment to use the EC2 reserved instance.

Leverage GPU Instances

CPUs and GPUs have a significant impact on both cost and performance. You should decide which kind is most suited to your needs. If you want to execute machine learning tasks on the cloud, for example, you should utilize modern GPU instances such as the G3 or P3 series. Even while GPUs have a greater cost per hour, GPU instances may greatly expedite training time and yield cost savings (as compared to CPUs).

Spot Instances for stateless and non-production workloads

Spot instances can save a lot of money for stateless and non-production workloads. You can save up to 90% off the on-demand pricing and lower your EC2 expenses. It should be emphasized that Spot Instances are subject to change and that they might be taken before the instance is utilized.

Leverage Tags & Setup Availability times

Understanding the NFR Non functional requirements of a business can help determine the hours our EC2 machines need to run. This way we can set up startup and shutdown times for the machine and avoid unwanted running cost and downtime for the machines.
You can save money on EC2 by prioritizing some EC2 instances over others. You may, for example, restrict your search to just production, non-production, and other instances. Tags can be used to find and optimize instances using the AWS dashboard and the AWS API. Tags may also be used for compliance and security.


The AWS Auto Scaling mechanism guarantees that the right number of Amazon EC2 instances are operating to manage the demand of a certain application. Auto Scaling modifies compute performance dynamically depending on a specified agenda or the current load measurements, raising or lowering the number of instances as required. You can utilize a range of scaling options provided by Amazon to adjust capacity to real demands. You can easily save money and prevent waste by dynamically scaling down capacity. Configure Auto Scaling with precision to maximize cost savings. You can over-provision capacity if you use Auto Scaling for applications that are too big or include too many instances.

EC2 Instances of appropriate size

Right-sizing is adopting an EC2 instance type that is a suitable match for your application or workloads to prevent underutilized resources. To identify the kind of instance necessary, evaluate the number of CPU and memory resources utilized by a certain application. After that, you can choose the instance type and number of instances that are most suited to your needs. You can also get the most out of your reserved instance purchases if you size wisely. You can save even more money by subscribing to a certain term and obtaining reserved instances once you’ve chosen the best configuration for your instance. However, it may be difficult to determine the right size when dealing with unpredictable workloads, and reserved instances are often wasted.

Orphaned Snapshots should be detected and eliminated

As per standard rules, any associated EBS volumes are automatically erased when an EC2 instance is terminated. Any snapshots that are still on S3 and are billing. These expenses might be more than you anticipate. Most backups are incremental, while the first snapshot captures the whole drive. Additionally, over time, incremental snapshots may need more data storage than the first one. Despite the fact that S3 is less costly than EBS volumes, you’ll need a strategy for deleting EBS volume snapshots when an EBS volume is destroyed. Over time, this might result in considerable storage cost savings.


Always plan to set up budgets and consume resources within the budget. Custom alerts can also help us realize if we used 50%, 75% or 90% of our limit


Learn more about the AWS cost explorer.


The Amazon EC2 service is a great way to get some computing power without having to manage a server. However, you can’t leave an instance running all day and night without paying for it. After all, it’s not free! Common issues that occur with EC2 costs – Underutilized and idle EC2 Instances, tracking reserved Instances with unused hours, Migration of EC2 Instances from a previous generation. Oversizing and inefficiency of the system bring their own set of challenges.

In conclusion, there are many ways to reduce your EC2 costs. By following the tips in this article, you can resolve the above challenges, save money and improve your efficiency. The cost of an EC2 instance is based on the instance configuration associated with data processing needs. Successfully minimizing EC2 expenses is totally reliant on the balance between the cloud computing needs to process corporate data and the quantity of the data that is being processed. Get in touch with us to lower your EC2 costs. With our expertise, you will be able to make the right choice for your tools.

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