Developing a strategy and implementing controls for expenditure and usage awareness

What AWS tools can you use to monitor and control your AWS expenditure?

You can use AWS Budgets to set custom budgets to track your cost and usage from the simplest to the most complex use cases. AWS Cost Explorer is useful for analyzing your costs and usage. AWS Organizations help to centrally govern your environment as you grow and scale your workloads. Additionally, AWS CloudTrail captures detailed information about the API calls made to your AWS resources.

Describe a method you would use to ensure cost optimization for a multi-tier, highly available application on AWS.

To ensure cost optimization for a multi-tier, highly available application, I would use AWS Cost Explorer to identify trends and pinpoint cost drivers, as well as Reserved Instances and Savings Plans for predictable workloads. I’d also implement auto-scaling to adjust resources based on demand, and choose the right-sized EC2 instances or containers to avoid over-provisioning.

Can you explain how tagging can be used to manage costs in AWS?

Tags can be applied to AWS resources, allowing you to categorize and track your AWS costs on a more granular level. Tags can be used to allocate costs to different departments, projects, or environments. By using cost allocation tags, you can break down your bill and attribute costs to the correct entities.

How can AWS Trusted Advisor help in controlling expenditure?

AWS Trusted Advisor provides real-time guidance to help you provision your resources following AWS best practices. It provides cost-optimization recommendations such as identifying under-utilized or idle resources, opportunities for Reserved Instances, and advice to reduce data transfer costs, all of which can help control and potentially reduce expenditure.

What strategies would you deploy to manage data transfer costs in AWS?

To manage data transfer costs, I would optimize data transfer by choosing the right AWS region to reduce cross-region data transfer costs, use caching services like Amazon CloudFront to reduce data transfer from origins, and apply data compression techniques. Additionally, I would consider using private IP addresses and VPC Endpoints to transfer data within the AWS network, avoiding internet transfer charges.

How would you design an alert system for unexpected spikes in AWS expenditure?

I would create a billing alert using AWS CloudWatch and AWS Budgets to trigger notifications when there’s an abnormal spike in spending. These alerts can be configured to notify the responsible teams through email or integrate with other systems like Amazon SNS to trigger automated workflows in response to the alert.

What is the AWS Cost and Usage Report and how can it be used for controlling costs?

The AWS Cost and Usage Report provides detailed information regarding your AWS costs and usage. You can use this report to delve deep into your AWS spending and usage data and analyze it in various dimensions. The report can help identify areas of high spending, and allow for more informed decisions on where costs can be reduced.

How do you use AWS cost allocation tags effectively?

I use cost allocation tags by applying a consistent set of tags, such as Project, Environment, and Department, to all resources. These tags enable detailed cost tracking and allocation on the AWS bill. Tagging policies and enforced tagging can ensure that every provisioned resource includes the necessary tags for cost allocation.

Explain how you would use Reserved Instances and Savings Plans to manage AWS costs.

Reserved Instances (RIs) and Savings Plans both offer a way to save on AWS costs by committing to a certain level of usage for a one or three-year term. For predictable workloads with consistent usage, RIs provide discounted hourly rates. With Savings Plans, AWS provides flexibility to apply the discount across different instances family, OS, or tenancies.

How do you prioritize cost optimization in the design of cloud infrastructure?

During the design phase, I prioritize cost optimization by selecting the right type and size of instances based on workload needs, utilizing scalable and managed services, employing serverless architectures where applicable, using storage lifecycle policies for S3, and architecting for high availability without over-provisioning.

Describe the role of AWS IAM in controlling costs.

AWS Identity and Access Management (IAM) plays a critical role in controlling costs by ensuring that users have the necessary permissions to perform their job without granting excess privileges that might lead to inadvertent resource provisionings, such as starting or scaling up expensive instances or services, which ultimately increase costs.

Discuss the importance of the AWS Well-Architected Framework in managing and optimizing cloud spend.

The AWS Well-Architected Framework provides a consistent approach to evaluating architectures against best practices and provides a set of strategies to help you compare your workload against AWS best practices. The cost optimization pillar specifically focuses on guiding developers to run systems to deliver business value at the lowest price point. Following this framework helps organizations to make informed decisions that affect their cloud spending in both the short and long term.