Reserved Instances

What are Reserved Instances (RIs)?

AWS Reserved Instances are a way to save money on many computing resources on Amazon Web Services (AWS). With RIs, customers can reserve compute capacity for a specific period (typically one or three years) and receive a significant discount on the hourly charge for that instance type. This can result in cost savings of up to 75% compared to on-demand prices. Essentially, RIs enable customers to prepay for computing capacity and in return, receive a lower cost per hour for that capacity. The best part? You can also buy reserved instances that are "no upfront" meaning there isn't a huge charge at the beginning, and instead, you pay a monthly rate to AWS, still at a discount.

When are RIs billed?

RIs are billed on your account on the 1st of each month at 12am UTC, just like monthly rent, (except you are saving money 🤑). Therefore, if you or our model has purchased RIs, you may see a big spike in your cost explorer at the beginning of each month.

Notice the spikes on the first of each moth? Those are from RI charges. In the month of March this RI is not consumed (hence no Pump savings), and hence Pump sold that RI in the next 30 days.

What happens to the RIs I purchased in the past?

When an account joins a different organization, AWS adjusts the RI billing for the remainder of the month. This is the scenario that occurs when an account joins us. Rest assured that the 1st of the month RI billing is reset, and AWS only bills you for those RIs from the 1st of the month to the day you join Pump. Pump will bill you for the rest of the month.

You can see the RIs purchased by you categorized separately from those bought by Pump.

Where can I see my savings from the RIs on AWS console?

To view your savings from Reserved Instances (RIs) on the AWS console, you can use the Cost Explorer tool.

1. Sign in to the AWS Management Console > Cost Explorer > RI Coverage tab (on the left hand side)

2. Choose the time period you want to view (e.g., last month, last quarter, custom date range).

3. In the "Savings Plans and Reserved Instances" section, you'll see a breakdown of your RI utilization and savings. You can see the number of RI hours used, the effective hourly rate, and the total savings in dollars.

By using the Cost Explorer, you can get a better understanding of how much money you're saving with your RIs and how effectively you're utilizing them. This can help you make informed decisions about future RI purchases and optimize your cloud spending.

Additionally, Pump makes it simple to track RI savings on the Pump app for anyone to directly understand their savings from this category.