Cost Budget
Overview
In this session, we will learn how to create and configure an AWS Cost Budget to monitor and manage our AWS spending effectively.
Note
Cost Budgets are the most common type of AWS Budget, allowing you to set thresholds for your AWS spending and receive alerts when costs exceed or are forecasted to exceed your defined limits.
How to start
1. Navigate Billing and Cost Management
- Sign in to AWS Console
- Search and select service Billing and Cost Management in the service search bar
2. Navigate to the Budgets section
- In the left navigation pane, select Budgets
- Click the Create budget button
3. Configure Budget
- Select Customize (advanced) for more control over our budget settings
- Under Budget types, select Cost budget
- Click Next
4. Set up budget
- Enter a descriptive Budget name (e.g., Monthly)
For Period, select the appropriate time interval:
- Daily for day-to-day monitoring
- Monthly for month-to-month tracking (most common)
- Quarterly for quarterly oversight
- Annually for yearly budget management
Under Budget renewal type:
- Select Recurring budget if you want this budget to continue indefinitely
- Select Expiring budget if you need a one-time budget for a specific timeframe
Note that all time zones are in UTC **
In the Specify your monthly budget section:
- Choose Fixed to set the same budget amount for each period
- Choose Monthly Budget Planning to set different amounts for each period
- Enter your Budgeted amount in your preferred currency
- For Budget scope, select All AWS services to monitor your entire AWS spending, then click Next.
5. Tags
- We enter some tags with key and value to filter and manage resource
- Click Next
6. Configure Alert
- In the Configure alerts section, click Add an alert threshold, then click Next.
7. Configure your alert settings
- Set the threshold percentage (e.g., 80% of actual or forecasted spend)
- Add email recipients who should receive notifications
- Optionally, configure an Amazon SNS topic for programmatic notifications
- Click Next
8. Review the budget actions settings
- Review the budget actions settings and click Next.
Note
Budget actions allow you to configure automated responses when a budget threshold is reached, such as applying an IAM policy or targeting specific EC2 or RDS instances.
- Click Create budget
9. Verify that your budget has been created successfully
Warning
AWS Budgets relies on billing data that updates approximately every 8-12 hours. There may be a delay between when costs are incurred and when alerts are triggered. For the most critical workloads, consider setting conservative thresholds to account for this delay.
