AWS Cost Optimization Tools to Reduce Cloud Costs

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Amazon Web Services (AWS) has become one of the latest technology trends companies follow nowadays, and there are a few reasons for that. First of all, its broad range of services and pricing options gives you the flexibility to get the performance and capacity you need. Enterprises around the globe have chosen AWS cloud computing because of its scalability and security. Another appealing aspect of Amazon Web Services is its “pay as you go” costing approach, which allows businesses to pay only for the resources they use, efficiently scaling their infrastructure according to demand fluctuations.

While AWS offers significant advantages over traditional on-premise infrastructure options, its flexibility and scalability often lead to out-of-control overheads. However, these unnecessary costs can be blurred and complicated to analyze, especially for an untrained eye. Without dedicated utilities to identify the source of costs and how to manage them, your profit margins can quickly fade away because of the overall costs. And it will be quite humbling if these costs are just a result of the oversight.

That’s why it’s so common to see businesses claim that they overspend in the cloud, that unused services waste a double-digit percentage of money, or that millions of companies provision resources with more capacity than they need. However, failure to reduce AWS costs is not necessarily the fault of businesses just because AWS pricing is challenging to analyze. 

For instance, if cloud customers believe they are only paying for what they use, not what they are being provided, it’s quite easy to find out that cloud bills can exceed expectations. In this case, additional services are also associated with the instances that drive up costs even when the samples are terminated. But what about a bit less obvious situations? In order to answer this question, today, our development team will check the list of some of the most popular AWS cost management tools and offer our own AWS cost optimization tool that will help you reduce your overall cloud costs and ensure these spendings align with your budgets. Let’s go!


What is Cost Optimization in AWS?

Cost optimization in AWS generally refers to the practice of efficient management and minimizing expenses associated with using AWS while maximizing the gained value. In this vein, any optimization process begins with a clear understanding of the broad picture. Looking ahead, we built an advanced Amazon cost analyzer tool to determine how you can get started with Amazon Web Services cost optimization for this purpose. This tool helps you visualize, analyze, and manage your AWS costs and usage over time, spending patterns across different dimensions, as well as your cost breakdowns across various resources. Once you understand what increases your AWS costs, you can explore optimization measures and make the first step toward cost reduction.

Why should you optimize your AWS costs?

Unlike on-premise environments, which often need high initial capital expenditures with low ongoing costs, cloud investments are operating expenses. As a result, cloud costs can easily go out of control, while tracking their efficiency over time becomes challenging. So, regulating cloud resources is essential for businesses in order to maximize their return on investment.

Cost optimization in terms of cloud computing comprises rightsizing resource utilization, selecting suitable pricing plans, monitoring spending patterns, enhancing architecture, and implementing automation where possible. For instance, AWS also has a built-in auto scaling function, which is a part of cloud optimization solutions. Cloud auto scaling allows organizations to increase or reduce cloud storage, networking, computing, and memory performance. In this way, they can adapt to fluctuating computing demands at any time. Under the AWS costing approach, you should pay only for the resources that they use. However, businesses can still require additional AWS cost tools to optimize resource utilization, as they can quickly face an expensive cost overrun, and auto scaling doesn’t work as intended. So, here, we created a guide on what to do if they don’t have a cost optimization tool to monitor spending and identify cost anomalies.


Our utility to calculate AWS costs

Have you ever wondered about the price for your logically grouped environments with a cloud provider like AWS, GCP, Azure, etc.? Have you found a tool to answer this question quickly and for free? Today, we will create a helpful utility that captures AWS EC2 resources and calculates their price in detail. Also, we will show an approach to how to implement it and leave room for extending this idea. We will use AWS’s boto3 JavaScript library and NodeJS to run this command line utility.


Let us assume you have two environments (for simplicity): dev and prod. Each domain consists of two services, Backend and Frontend, where each service is just a set of static EC2 instances, and each EC2 instance is tagged with at least these tags:

  • Env: dev
  • Service: frontend
  • Name:

Cost optimization tool that we build

So, at the end of this article, we will have a command line tool SHOW-PRICE, which accepts a single parameter – path, so, if we wish to see the price of all environments, we have to run SHOW-PRICE-P “*” in case we would like to check the price of all services – SHOW-PRICE-P “*.*”. The output will look like the following:

$ show-price -p "*"

.dev = 0.0058$ per hour
.prod = 0.0058$ per hour

$ show-price -p "*.*"

.dev.frontend = 0.0406$ per hour
.dev.backend = 0.0406$ per hour
.prod.backend = 0.0058$ per hour
.prod.frontend = 0.0058$ per hour



Firstly, we have to configure our local environment and provide AWS credentials. So:

# Create a folder with the AWS IAM access key and secret key
$ mkdir -p ~/.aws/

# Add credentials file
$ > ~/.aws/credentials

# Paste your IAM access key and secret key into this file
$ cat ~/.aws/credentials
aws_access_key_id = AKIA***
aws_secret_access_key = gDJh****

# Clone the project and install a show-price utility
$ git clone [email protected]:vpaslav/show-price.git && cd show-price
$ npm install.

Data structure definition

As we work with hierarchical data, using a simple tree structure would be best. So, our AWS infrastructure can be represented in a tree TreeNode as in the example below:

* env name
*   |_ service 1
*          |_ instanceId 1: key: name, value: price
*          |_ instanceId 2: key: name, value: price
*   |_ service 2
*          |_ instanceId 3: key: name, value: price
*          |_ instanceId 4: key: name, value: price

Having this structure, we can easily orient over it and extract the information that we need. You can find more details about tree implementation, for instance, here.

Data structure processing

We need the following main methods:- TreeNode.summarizePrice method, which recursively summarizes all prices for all the nodes in a tree up to the root to process our tree. Code:

static summarizePrice(node) {
 if (node.isLeaf()) return Number(node.value);
 for (const child of node.children) {
   node.value += TreeNode.summarizePrice(child);
 return Number(node.value);

TreeNode.displayPrice method that iterates over the tree and displays nodes in case their path equals a defined pattern. Code:

static displayPrice(node, pathRegexp) {
 if (node.path.match(pathRegexp)) {
   console.log(`${node.path} = ${node.value}$ per hour`);
 for (const child of node.children) {
   TreeNode.displayPrice(child, pathRegexp);

Let’s store prices for all the instance types in a simple CSV file, which we can read and put into a tree for every leaf node, basically an AWS instance. And finally, let’s extract data from AWS Cloud and use the TreeNode class to structure them in the way we need.


The final result displays AWS cost optimization opportunities

After all manipulations, we will have a cool tool that could display costs per env, service, or even specific instance. For example:

# Display price per envs only
$ show-price -p "*"
.prod = 0.0174$ per hour
.dev = 0.0116$ per hour

# Display price per envs per services
$ show-price -p "*.*"
.prod.front = 0.0174$ per hour
.dev.front = 0.0058$ per hour
.dev.back = 0.0058$ per hour

# Display price for a specific env
$ show-price -p "prod"
.prod = 0.0174$ per hour

# Display price for a specific env and all its services
$ show-price -p "prod.*"
.prod.front = 0.0174$ per hour

# Display price for all specific services within all envs
$ show-price -p "*.front"
.prod.front = 0.0174$ per hour
.dev.front = 0.0058$ per hour

# Display price for a specific instance in a specific env and service
$ show-price -p "prod.front.i-009105b93c431c998"
.prod.front.i-009105b93c431c998 = 0.005800$ per hour

# Display price of all instances for an env
$ show-price -p "prod.*.*"
.prod.front.i-009105b93c431c998 = 0.005800$ per hour
.prod.front.i-01adbf97655f57126 = 0.005800$ per hour
.prod.front.i-0c6137d97bd8318d8 = 0.005800$ per hour

Key principles and strategies for AWS cloud cost optimization

It can sound a bit complicated at first, but in practice, it is a bit more obvious. Just try our solution by yourself and see how it can make a difference for your business. Also, below, we provided several examples of key principles and practices that are generally good and work for almost any case (not only tools):

  • See which AWS services cost you the most and why.
  • You can align AWS cloud costs with business metrics.
  • Empower engineering to better report on AWS costs to finance.
  • Identify cost optimization opportunities you may not be aware of, such as architectural choices you can make to improve profitability.
  • Identify and track unused instances so you can remove them to eliminate waste.
  • Detect, track, tag, and delete persistent unallocated storage, such as Amazon EBS volumes, when you delete an associated instance.
  • Identify soon-to-expire AWS Reserved Instances (RI), and avoid having expired RI instances which lead to more expenses.
  • Introduce cost accountability by showing your teams how each project impacts the business’s overall bottom line, competitiveness, and ability to fund future growth. 
  • Tailor your provisioning to your needs.
  • Automate cloud cost management and optimization. Test native AWS tools before using more advanced third-party tools.
  • Schedule on and off times unless workloads need to run all the time.
  • Also, you need to clearly understand the type of computing capacity your business actually needs and demand instances in the exact quantity you need. Amazon Web Services offers multiple options where pre-orders may save high costs, but for this, again, you need to calculate the number of instances you need accurately.
  • AWS Spot Instances is another hint that allows you to save money and, therefore, optimize your costs. However, this strategy is definitely not for every business model, as Spot Instances work similarly to the marketplace, but AWS can interrupt these instances at any time if they are needed for on-demand. Spot Instances are ideal for stateless, fault-tolerant, or flexible applications like batch processing, data analysis, or background tasks.
  • Use as flexible pricing model as you can.
  • Regularly monitor resource usage and expenses. You can identify areas for improvement by just staying informed about usage patterns and cost trends.
  • Continually refine architecture to improve its efficiency. This may involve optimizing resource allocation, implementing more cost-effective design patterns, and leveraging managed services to offload operational overhead.
  • For certain business models, an AWS Instance Scheduler may also be a viable solution. It allows you to automate the start and stop times of EC2 instances based on predefined schedules, which can reduce costs associated with running 24/7.
  • For processes that depend heavily on computational power, keeping up with the latest instance types (better performance yet usually lower costs) can be an efficient solution.
  • Don’t hesitate to use built-in AWS optimization tools, such as AWS Cost Explorer, AWS Trusted Advisor, AWS Budgets, Amazon CloudWatch, AWS CloudTrail, Amazon S3 Analytics, AWS Compute Optimizer, AWS Cost and Usage Report, and, of course, AWS Pricing Calculator (we will return to them a bit later).
  • Use third-party tools if you feel that AWS cannot offer you the solution you need.

Also, you may be interested in our article: Better and secure deployment process to AWS with Bitbucket

Non-production resources, such as development environment, staging, testing, and quality assurance, are needed just during a work week, which means 40 business hours. However, AWS on-demand charges are based on the time the resources are in use. So, spending on non-production resources is wasted at night and also on weekends (roughly 65% of the week).

AWS oversized resources

Oversized resources are often a second reason for an increase in AWS costs. AWS offers a range of sizes for each instance option, and many companies keep by default the largest size available. However, they don’t know what capacity they’ll need in the future. A study by ParkMyCloud found that the average utilization of provisioned AWS resources was just 2%, an indication of routine overprovisioning. If a company shrinks an instance by one size, it reduces AWS costs by 50%. Reducing by two sizes saves them 75% on AWS cloud spend. The easiest way to reduce AWS costs quickly and significantly is to reduce spending on unnecessary resources.

Using our solution, you get a cost optimization process that is simply about reducing cloud costs through a series of optimization techniques such as:

  • Identifying poorly managed resources
  • Eliminating waste
  • Reserving capacity for higher discounts
  • And right-sizing computing services for scaling.

AWS cost optimization tools

Before moving to the third-party utilities, you should try native AWS tools. Here is a short list of the built-in AWS cost optimization tools: 

AWS Cost Explorer

AWS Cost Explorer allows users to track, report, and analyze spent costs over time. It can also help with forecasting costs by identifying areas for further inquiry, observing reserved instance utilization and coverage, as well as receiving recommendations. That’s a very decent tool, in our opinion, you should definitely try it!

AWS Trusted Advisor:

This native tool provides real-time identification of potential areas for optimization, offering valuable insights into effectively optimizing AWS resources.

AWS Budgets

With AWS Budgets, users can set custom budgets, triggering alerts when costs or usage exceed budgeted amounts. Budgets can be customized based on cost allocation tagging, accounts, resource types, and forecasted usage.

Amazon CloudWatch

Another native tool that logs, monitors, and retains account activity related to actions across AWS infrastructure at a low cost. It provides detailed insights into resource utilization and cost optimization.

AWS Cost and Usage Report

The AWS Cost and Usage Report provides granular raw data files detailing hourly AWS usage across accounts for DIY analysis. It offers valuable insights into usage patterns and, of course, also helps to build effective cost optimization strategies based on these patterns.


AWS cost management tools by third-party providers

For many businesses, the platform’s native tools are a sufficient solution for tracking and managing cloud costs. However, there are still certain cases where you might seek a utility with some additional advanced features or deeper analysis. Here is a list of several third-party AWS cloud cost optimization tools: is a cloud cost transparency and management tool designed to help monitor, manage, and optimize cloud expenses. It is cloud-agnostic and compatible with Microsoft Azure, too. It offers users a simplified and clear view of their cloud spending, enabling them to understand where their money is going and identify opportunities to cut idle resources. They provided detailed billing insights, cost analysis, and reporting tools that break down cloud expenses by service, project, or team. also includes automation capabilities to help users take immediate action on cost-saving opportunities, such as resizing or terminating underutilized resources or identifying orphaned resources that are no longer in use but still incurring costs.

Cloud Health by VMware

CloudHealth provides a comprehensive view of your cloud costs across multiple services and platforms, including AWS. CloudHealth’s recommendations for cost-saving are backed by robust analytics, which identify underutilized resources or suggest changes in service plans to match usage patterns more efficiently. Additionally, CloudHealth offers governance and compliance tools, ensuring that cloud deployments adhere to company policies and external regulations, further optimizing cloud environments for cloud security, cost, and compliance.


Turbonomic takes a unique approach by focusing on application performance alongside cost optimization. It uses AI-driven analytics to continuously analyze application demand and available cloud resources. By doing so, Turbonomic ensures that every application receives exactly the resources it needs for optimal performance without overprovisioning or wastage. Turbonomic’s automation capabilities extend to scaling resources up or down based on demand, making operational decisions that balance cost and performance automatically.


CloudCheckr provides a comprehensive suite of tools designed to manage both the cost and security aspects of AWS cloud environments. Being one of the oldest AWS cost optimization tools, they have a lot of experience dealing with security, which is why CloudCheckr offers a dual-focus solution that can be a great benefit in certain cases.

Some additional tools to reduce cloud costs using business analysis:

  • Select the Delete on Termination checkbox when creating or launching an EC2 instance. When you terminate the attached instance, the unattached EBS volumes are automatically removed.
  • Decide which workloads you wish to use, considering Reserved Instances, and which you want to use On-Demand Pricing.
  • Keep your latest snapshot for a few weeks and then delete it while you create even more recent snapshots that you can use to recover your data in the event of a disaster.
  • Avoid reassigning an Elastic IP address more than 100 times per month. It guarantees that you will avoid having to pay for that. If you can not, use an optimization tool to find and free unallocated IP addresses after killing the bounded instances.
  • Upgrade to the latest generation of AWS instances to improve performance at a lower cost.
  • Use optimization tools to find and kill unused Elastic Load Balancers
  • Optimize your cloud costs as an ongoing part of your DevOps culture.

AWS cost optimization is a continuous process

Applying best practices to AWS cost optimization and using cloud spend optimization tools is an everlasting process. Optimizing costs should be a process that looks at reducing your AWS spending, aligning that spending with essential business outcomes, and optimizing your environment to meet your business goals.

An excellent approach to AWS cost optimization starts with getting a detailed picture of your current costs, identifying opportunities to optimize costs, and then implementing changes. Using our utility and other AWS cost optimization tools, as well as analyzing the results and implementing changes on your cloud, can be challenging, so don’t hesitate to contact ELITEX if you need any cloud consulting.

While cost optimization has traditionally focused on reducing waste and purchasing plans (such as reserved instances), many forward-thinking organizations increasingly focus on technical enablement and architecture optimization.

Enterprises have realized that cost optimization is not just reducing AWS costs but also providing technical teams with the required cost information to make cost-driven development decisions that lead to profitability. Additionally, engineering needs to be able to properly report cloud spending to finance – and see how that spending aligns with the business metrics they care about. Engineers can see the cost impact and how code changes affect their AWS spend.

You must monitor the AWS cloud to determine when assets are underutilized or unused. The utility will also help you see opportunities to reduce costs via terminating, deleting, or releasing zombie assets. Monitoring Reserved Instances is vital to ensure they are entirely utilized. Of course, it’s impossible to manually scan a cloud environment 24/7, 365 days per year, so many organizations use policy-driven automation.


Hire cloud experts to manage and reduce AWS costs

If you are worried about overspending, our solution and tips can automate cost anomaly alerts that notify engineers of cost fluctuations so teams can address any code issues to prevent cost overruns. Many organizations end up under-resourcing, compromising performance or security, or under-utilizing AWS infrastructure. 

Working with AWS cloud experts is the best way to create an efficient AWS cost optimization strategy. While a company could continue to analyze its costs and implement improvements, new issues could arise. 

Whether you seek a consultation regarding cloud strategy or reliable DevOps services, don’t hesitate to schedule a free consultation today. With ELITEX, your cloud solutions are in safe hands. Our technical team can help you avoid all cost-associated traps and reduce your AWS expenditures. ELITEX shows results beyond your expectations. With continuous monitoring, you can be sure you aren’t missing any cloud cost optimization opportunities.


FAQ about AWS cost optimization

What are AWS cost optimization tools?

AWS cloud cost optimization utilities and tools are services provided by AWS and third parties to help users monitor, manage, and optimize their cloud spending. These tools offer insights into your usage patterns and suggest ways to reduce costs and increase efficiency, basically.

How do I get started with AWS optimization?

Review your current AWS usage and costs using AWS cost monitoring tools, such as the AWS Cost Explorer or our tool. Then, set up AWS Budgets to monitor your spending and use AWS Trusted Adviser to get recommendations for cost-saving opportunities.

What are reserved instances, and how can they help save on AWS costs?

Reserved Instances are a billing model applied to using EC2 instances in your account. You commit to using a specific instance type for a certain period (usually a year or a few), which can significantly reduce your computing costs compared to on-demand instance pricing. However, it definitely requires careful and accurate planning.

How can I optimize data transfer costs on AWS?

Consider using native AWS cost tools like Amazon CloudFront for content delivery, choosing the right data transfer methods, and managing your routes efficiently. Also, monitor and analyze your transfer costs regularly to identify optimization opportunities.

How can I estimate my AWS costs before deploying services?

Use AWS Pricing Calculator for AWS cost management before deploying services. This tool allows you to model your solutions and estimate the costs for your specific use case and requirements.

What is the solution to reduce AWS costs?

Well, you should use specific cost management tools, reserve instances, optimize your resource usage, and regularly review your service based on performance and cost data. Also, check our tool tailored for AWS cost reduction. 

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