AWS Cost Optimization
Apply practical FinOps controls to reduce AWS spend without sacrificing reliability or performance.
When to Use This Skill
- Monthly AWS bill spikes unexpectedly or exceeds budget thresholds
- Preparing cost reviews with engineering and finance teams
- Rightsizing EC2, RDS, EKS, or Lambda workloads after load testing
- Choosing between Savings Plans, Reserved Instances, or on-demand pricing
- Setting up automated budget alerts and anomaly detection
- Cleaning up unused resources (unattached EBS, idle load balancers, old snapshots)
- Optimizing data transfer costs across regions and AZs
Prerequisites
- AWS CLI v2 installed and configured (
aws configure) - IAM permissions:
ce:*,budgets:*,ec2:Describe*,cloudwatch:PutMetricAlarm,s3:PutLifecycleConfiguration - Cost Explorer enabled in the AWS billing console (takes 24 hours to populate)
- Cost allocation tags activated in the Billing console
Cost Review Workflow
- Tag every resource by team, service, environment, and cost center.
- Enable Cost Explorer and activate Cost and Usage Reports (CUR) to S3.
- Identify top spend drivers by service, account, and tag.
- Rightsize underutilized compute and storage based on CloudWatch metrics.
- Apply commitment discounts (Savings Plans or RIs) for stable baseline usage.
- Set budgets, anomaly alerts, and build KPI dashboards.
- Review monthly and iterate.
Cost Explorer CLI Commands
bash# Get cost and usage for the last 30 days grouped by service aws ce get-cost-and-usage \ --time-period Start=2026-02-01,End=2026-03-01 \ --granularity MONTHLY \ --metrics "BlendedCost" "UnblendedCost" "UsageQuantity" \ --group-by Type=DIMENSION,Key=SERVICE # Get cost forecast for the next 30 days aws ce get-cost-forecast \ --time-period Start=2026-03-24,End=2026-04-24 \ --metric UNBLENDED_COST \ --granularity MONTHLY # Get cost grouped by a specific tag (e.g., team) aws ce get-cost-and-usage \ --time-period Start=2026-02-01,End=2026-03-01 \ --granularity MONTHLY \ --metrics "UnblendedCost" \ --group-by Type=TAG,Key=team # Get rightsizing recommendations for EC2 aws ce get-rightsizing-recommendation \ --service "AmazonEC2" \ --configuration '{"RecommendationTarget":"SAME_INSTANCE_FAMILY","BenefitsConsidered":true}' # Get Savings Plans purchase recommendation aws ce get-savings-plans-purchase-recommendation \ --savings-plans-type COMPUTE_SP \ --term-in-years ONE_YEAR \ --payment-option NO_UPFRONT \ --lookback-period-in-days SIXTY_DAYS # Get Savings Plans utilization aws ce get-savings-plans-utilization \ --time-period Start=2026-02-01,End=2026-03-01 \ --granularity MONTHLY # Get Reserved Instance utilization aws ce get-reservation-utilization \ --time-period Start=2026-02-01,End=2026-03-01 \ --granularity MONTHLY
Budget Alerts
bash# Create a monthly cost budget with email alert at 80% and 100% aws budgets create-budget \ --account-id 123456789012 \ --budget '{ "BudgetName": "monthly-total", "BudgetLimit": {"Amount": "5000", "Unit": "USD"}, "TimeUnit": "MONTHLY", "BudgetType": "COST", "CostFilters": {}, "CostTypes": { "IncludeTax": true, "IncludeSubscription": true, "UseBlended": false } }' \ --notifications-with-subscribers '[ { "Notification": { "NotificationType": "ACTUAL", "ComparisonOperator": "GREATER_THAN", "Threshold": 80, "ThresholdType": "PERCENTAGE" }, "Subscribers": [{"SubscriptionType": "EMAIL", "Address": "finops@example.com"}] }, { "Notification": { "NotificationType": "ACTUAL", "ComparisonOperator": "GREATER_THAN", "Threshold": 100, "ThresholdType": "PERCENTAGE" }, "Subscribers": [{"SubscriptionType": "EMAIL", "Address": "finops@example.com"}] } ]' # List all budgets aws budgets describe-budgets --account-id 123456789012 # Enable Cost Anomaly Detection monitor for all services aws ce create-anomaly-monitor \ --anomaly-monitor '{ "MonitorName": "all-services", "MonitorType": "DIMENSIONAL", "MonitorDimension": "SERVICE" }' # Create anomaly subscription (alert when impact > $50) aws ce create-anomaly-subscription \ --anomaly-subscription '{ "SubscriptionName": "cost-alerts", "MonitorArnList": ["arn:aws:ce::123456789012:anomalymonitor/monitor-id"], "Subscribers": [{"Type": "EMAIL", "Address": "finops@example.com"}], "Threshold": 50, "Frequency": "DAILY" }'
CloudWatch Cost Alarm
bash# Create alarm for estimated charges exceeding $4000 aws cloudwatch put-metric-alarm \ --alarm-name "billing-alarm-4000" \ --alarm-description "Alert when estimated charges exceed $4000" \ --metric-name EstimatedCharges \ --namespace AWS/Billing \ --statistic Maximum \ --period 21600 \ --threshold 4000 \ --comparison-operator GreaterThanThreshold \ --evaluation-periods 1 \ --dimensions Name=Currency,Value=USD \ --alarm-actions "arn:aws:sns:us-east-1:123456789012:billing-alerts" \ --treat-missing-data notBreaching
Find and Clean Unused Resources
bash# List unattached EBS volumes (wasted storage spend) aws ec2 describe-volumes \ --filters Name=status,Values=available \ --query "Volumes[].{ID:VolumeId,Size:Size,Created:CreateTime}" \ --output table # Find old EBS snapshots (older than 90 days) aws ec2 describe-snapshots \ --owner-ids self \ --query "Snapshots[?StartTime<='2025-12-24'].{ID:SnapshotId,Size:VolumeSize,Date:StartTime}" \ --output table # List unused Elastic IPs (charged when not associated) aws ec2 describe-addresses \ --query "Addresses[?AssociationId==null].{IP:PublicIp,AllocId:AllocationId}" \ --output table # Find idle load balancers (zero healthy targets) aws elbv2 describe-target-health \ --target-group-arn arn:aws:elasticloadbalancing:us-east-1:123456789012:targetgroup/my-tg/abc123 # List RDS instances and their utilization aws cloudwatch get-metric-statistics \ --namespace AWS/RDS \ --metric-name CPUUtilization \ --dimensions Name=DBInstanceIdentifier,Value=mydb \ --start-time 2026-03-17T00:00:00Z \ --end-time 2026-03-24T00:00:00Z \ --period 86400 \ --statistics Average
S3 Lifecycle Cost Optimization
bash# Apply tiered lifecycle policy to reduce storage costs aws s3api put-bucket-lifecycle-configuration \ --bucket my-data-bucket \ --lifecycle-configuration '{ "Rules": [ { "ID": "TierDownOldData", "Status": "Enabled", "Filter": {"Prefix": ""}, "Transitions": [ {"Days": 30, "StorageClass": "STANDARD_IA"}, {"Days": 90, "StorageClass": "GLACIER"}, {"Days": 365, "StorageClass": "DEEP_ARCHIVE"} ], "NoncurrentVersionTransitions": [ {"NoncurrentDays": 30, "StorageClass": "GLACIER"} ], "NoncurrentVersionExpiration": {"NoncurrentDays": 90} }, { "ID": "CleanupIncompleteUploads", "Status": "Enabled", "Filter": {"Prefix": ""}, "AbortIncompleteMultipartUpload": {"DaysAfterInitiation": 7} } ] }'
Terraform Budget and Alarm Example
hclresource "aws_budgets_budget" "monthly" { name = "monthly-total" budget_type = "COST" limit_amount = "5000" limit_unit = "USD" time_unit = "MONTHLY" notification { comparison_operator = "GREATER_THAN" threshold = 80 threshold_type = "PERCENTAGE" notification_type = "ACTUAL" subscriber_email_addresses = ["finops@example.com"] } notification { comparison_operator = "GREATER_THAN" threshold = 100 threshold_type = "PERCENTAGE" notification_type = "ACTUAL" subscriber_email_addresses = ["finops@example.com"] } } resource "aws_cloudwatch_metric_alarm" "billing" { alarm_name = "billing-alarm-4000" comparison_operator = "GreaterThanThreshold" evaluation_periods = 1 metric_name = "EstimatedCharges" namespace = "AWS/Billing" period = 21600 statistic = "Maximum" threshold = 4000 alarm_description = "Billing exceeds $4000" alarm_actions = [aws_sns_topic.billing_alerts.arn] dimensions = { Currency = "USD" } }
Scheduling Non-Production Shutdowns
bash# Stop all dev instances tagged Environment=dev (run via EventBridge + Lambda) aws ec2 describe-instances \ --filters "Name=tag:Environment,Values=dev" "Name=instance-state-name,Values=running" \ --query "Reservations[].Instances[].InstanceId" \ --output text | xargs -n1 aws ec2 stop-instances --instance-ids # Scale down dev ECS services to zero at night aws ecs update-service \ --cluster dev-cluster \ --service dev-api \ --desired-count 0
Troubleshooting
| Problem | Cause | Fix |
|---|---|---|
| Cost Explorer returns empty data | CE not enabled or < 24h old | Enable in Billing console, wait 24h |
| Budget alert not firing | SNS subscription not confirmed | Check email and confirm subscription |
| Rightsizing shows no recommendations | Not enough usage data | Wait 14 days for sufficient metrics |
| Savings Plans utilization low | Over-purchased or workload changed | Review and adjust SP coverage |
| Unattached EBS not showing | Wrong region queried | Loop through all active regions |
| Billing alarm never triggers | Billing metrics only in us-east-1 | Create alarm in us-east-1 region |
| CUR data missing in S3 | Report not configured or bucket policy wrong | Verify CUR setup in Billing console |
| Tag-based cost allocation empty | Tags not activated | Activate cost allocation tags in Billing |
Related Skills
- aws-ec2 - EC2 operations, sizing, and Spot instances
- aws-s3 - S3 storage classes and lifecycle controls
- aws-rds - RDS instance sizing and reserved instances
- aws-lambda - Lambda pricing and concurrency tuning
- terraform-aws - Codifying cost guardrails in IaC
