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AWS Solutions Architect · Lesson

Reserved Instances, Savings Plans, and Spot

Commit to Reserved Instances or Savings Plans for steady workloads and use Spot Instances for interruption-tolerant batch and stateless tasks.

EC2 Purchasing Models Overview

AWS offers multiple EC2 purchasing models that trade flexibility for cost savings. On-Demand charges by the second with no commitment — the most flexible but most expensive. Reserved Instances provide up to 72% savings for 1 or 3-year commitments. Savings Plans provide up to 66% savings with a flexible hourly spend commitment. Spot Instances use spare capacity for up to 90% savings but can be interrupted. Dedicated Hosts provide physical servers for licensing compliance at premium cost. Understanding each model is critical for SAA-C03 cost scenarios.

# EC2 pricing models (m5.large in us-east-1, approximate):
# On-Demand:        $0.096/hr ($70/month)
# 1yr RI (No Upf): $0.062/hr ($45/month) - 35% savings
# 1yr RI (All Upf): $0.051/hr ($37/month) - 47% savings
# 3yr RI (All Upf): $0.032/hr ($23/month) - 67% savings
# Spot:            $0.030-0.050/hr       - 50-70% savings

# Rule: RI/SP for steady state, Spot for burst/interruptible

Reserved Instances: Types and Payment Options

Reserved Instances (RIs) are a billing construct, not a specific instance — they provide a discount applied to matching On-Demand instances in your account. RI types: Standard RIs — highest discount (up to 72%) but cannot change instance family. Convertible RIs — lower discount (~54%) but can exchange for different instance family, OS, or tenancy. Payment options: No Upfront (monthly payments, lowest commitment), Partial Upfront (lower effective rate), All Upfront (lowest effective hourly rate). Choose Standard RIs for predictable, unchanging workloads.

# Purchase Reserved Instance
aws ec2 purchase-reserved-instances-offering \
  --reserved-instances-offering-id offering-id-here \
  --instance-count 5

# List RI offerings
aws ec2 describe-reserved-instances-offerings \
  --instance-type m5.large \
  --product-description 'Linux/UNIX' \
  --offering-type 'No Upfront' \
  --duration 31536000 \
  --query 'ReservedInstancesOfferings[].{Price:RecurringCharges[0].Amount,Class:OfferingClass}'

All lessons in this course

  1. Right-Sizing and Compute Optimizer
  2. Reserved Instances, Savings Plans, and Spot
  3. Cost Explorer, Budgets, and Cost Allocation Tags
  4. S3 and Data Transfer Cost Optimisation
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