The Ultimate Guide to AWS Reserved Instances

The Ultimate Guide to AWS Reserved Instances

Are you looking to maximize your cost savings when using Amazon Web Services (AWS)? Look no further than AWS Reserved Instances! In this ultimate guide, we’ll explore the benefits of AWS Reserved Instances, how to purchase them, and the different types of Reserved Instance offerings available. Get ready to learn the ins and outs of AWS Reserved Instances and start reaping the cost-saving rewards!

Introduction to AWS Reserved Instances

The cloud computing space is rapidly changing, and as a result, businesses must be able to adapt to the new technology and tools available. One of the most important tools for businesses to use is Amazon Web Services (AWS) Reserved Instances. AWS Reserved Instances are a cost-effective way for businesses to purchase cloud computing services, such as Amazon Elastic Compute Cloud (EC2) or Amazon Relational Database Service (RDS). With AWS Reserved Instances, businesses can save money on the cost of their AWS services and gain more control over their cloud computing environment.

In this guide, we’ll take an in-depth look at what AWS Reserved Instances are, the types of Reserved Instances available, the benefits of using them, how to purchase and manage them, and best practices for using them.

What are AWS Reserved Instances?

AWS Reserved Instances are a type of cloud service offering from Amazon Web Services that allow businesses to purchase compute, storage, or database services at a discounted price. Reserved Instances are available for all AWS services, including Amazon Elastic Compute Cloud (EC2) and Amazon Relational Database Service (RDS).

When a business purchases a Reserved Instance, it reserves a certain number of resources for a specified period of time. The business is then billed at a lower rate for the Reserved Instances’ usage compared to the standard rates for the same services. Reserved Instances can be purchased for 1- or 3-year terms, and the longer the term, the greater the discount.

Benefits of AWS Reserved Instances

AWS Reserved Instances provide a variety of benefits for businesses that use AWS services on a regular basis. The most notable benefit is the cost savings. By purchasing Reserved Instances, businesses can save up to 75% on the cost of their AWS services compared to the standard rates for the same services. 

In addition to cost savings, Reserved Instances also provide businesses with more control over their cloud computing environment. By reserving a certain number of resources for a predetermined period of time, businesses can better plan and manage their cloud computing needs.

Types of AWS Reserved Instances

AWS Reserved Instances are available for all AWS services, including Amazon Elastic Compute Cloud (EC2) and Amazon Relational Database Service (RDS). Reserved Instances are available in three different types: Standard, Convertible, and Scheduled.

  • Standard Reserved Instances are the most basic type of Reserved Instance. They provide the greatest discount, but they are also the least flexible. Standard Reserved Instances are purchased for a specific EC2 instance type, such as m4.large, and can’t be modified or exchanged for other instance types.
  • Convertible Reserved Instances are more flexible than Standard Reserved Instances. They can be exchanged for other instance types, allowing businesses to upgrade or downgrade their instance types as needed. Convertible Reserved Instances also provide a greater discount than Standard Reserved Instances.
  • Scheduled Reserved Instances are a type of Reserved Instance that allows businesses to purchase Reserved Instances for a specific time period. This allows businesses to better manage their cloud computing needs by reserving resources for peak usage times.

How to Purchase AWS Reserved Instances

Purchasing AWS Reserved Instances is a straightforward process. The first step is to decide which type of Reserved Instance to purchase. After selecting the type of Reserved Instance, businesses can choose the EC2 instance type, the region, and the term length. 

Once the Reserved Instance has been selected, businesses can purchase the Reserved Instance through the AWS Marketplace. The Reserved Instance will be billed to the business’s AWS account on a monthly basis.

Managing AWS Reserved Instances

Once a business has purchased a Reserved Instance, it’s important to manage it properly in order to ensure optimal cost savings. Businesses should monitor their Reserved Instances usage to ensure that they are being utilized efficiently. If a business finds that their Reserved Instances are not being used, they should consider exchanging them for other instance types or canceling them altogether. 

Businesses should also periodically review their Reserved Instances to ensure that they are still the best solution for their cloud computing needs. As businesses’ needs change, they may find that a Reserved Instance is no longer the best solution and should consider purchasing On-Demand instances instead.

Best Practices for Using AWS Reserved Instances

When using AWS Reserved Instances, there are several best practices that businesses should follow in order to maximize their cost savings. 

  • First, businesses should purchase Reserved Instances for the longest term possible. This will provide the greatest discount and ensure that businesses are getting the most value from their Reserved Instances. 
  • Second, businesses should purchase Reserved Instances for the instance types and regions that they expect to use the most. This will ensure that Reserved Instances are being used efficiently and will provide the greatest cost savings.
  • Third, businesses should monitor their Reserved Instances usage and exchange or cancel them as needed. This will ensure that businesses are only paying for the resources that they need.

Conclusion

AWS Reserved Instances are a cost-effective way for businesses to purchase cloud computing services from Amazon Web Services. By purchasing Reserved Instances, businesses can save up to 75% on the cost of their AWS services compared to the standard rates. 

In addition to cost savings, Reserved Instances also provide businesses with more control over their cloud computing environment. By reserving a certain number of resources for a predetermined period of time, businesses can better plan and manage their cloud computing needs. By following the best practices outlined in this guide, businesses can ensure that they are getting the most value from their AWS Reserved Instances and maximizing their cost savings.
You can employ rightsize RIs, auto-scaling, and spot instances to adapt your computing requirements. Extensive planning and forecasting are needed for this. Plus, anticipating future utilization without any proper metrics stands near impossible. Thus, the nOps ShareSave model can be a game-saver if you want your metrics sorted. Also, even if the chosen pricing model is not helping you save appropriately, with our ShareSave solution you can consolidate cloud accounts into a single pricing model and offer ongoing visibility to change requests. This helps you easily manage cloud costs and save more money.