AWS Budgets vs. Cost Explorer—a comprehensive comparison

Even if you’re unfamiliar with Amazon Web Services (AWS) cloud solutions, you can probably guess that AWS Budgets and Cost Explorer have something to do with managing expenses. The two services do revolve around cost management and belong to the AWS Cloud Financial Management suite. But they have distinct purposes—one is concerned with planning and monitoring budgets, while the other helps you visualize costs.

In this article, we’ll provide an in-depth comparison of AWS Budgets vs. Cost Explorer, breaking down their features, use cases, and pricing to help you understand how the tools work.

What is AWS Budgets?

AWS Budgets is a cloud financial management service that helps you set and track cost and usage budgets and get alerts whenever you exceed the set limits. This is the tool you should use if you want to:

• Increase cost transparency

• Avoid burning through your budget by properly allocating your resources

Here’s a simple example of using AWS Budgets:

1. Setting the budget: You set up a monthly cost budget of, for example, $700 for services such as Amazon Elastic Compute Cloud (EC2), Amazon Simple Storage Service (S3), and Amazon Relational Database Service (RDS).

2. Setting alerts: When the expenses for your AWS services reach 70% of your set budget (in our example, that’s $490), you’ll get an alert.

3. Applying an action: You’ve reached 80% of your monthly cost budget, and you’re only halfway through the month. You don’t want to go over your budget, so you take action—for example, you can adjust controls to prevent adding more resources within an account. Or, you could analyze resource usage and give up those you don’t use.

4. Reviewing: It’s the end of the month, and you’ve spent $690, so kudos for staying within your budget. You can now revise your budget plans and see if you need to adjust the budget limit for the month ahead.

What are the use cases of AWS Budgets?

AWS Budgets excels in the following areas:

Monitoring cost and usage

AWS Budgets lets you set different budget limits for specific time periods, services, or accounts. As time goes by, you can track your usage to see if you’re staying within your budget. In the long term, monitoring cost and usage through AWS Budgets can help you refine your AWS financial strategy and ensure you don’t waste a cent on services and resources you don’t use.

You can automate tracking cost and usage by generating scheduled reports that provide insight into your budget's performance within a specific time period. These reports can be delivered to up to 50 email addresses.

Understanding and planning your budget

The service gives you a detailed insight into how your actual and forecasted costs progress toward your budget threshold. Based on your current expenses, AWS Budgets can predict future usage and costs so that you can plan your budget with confidence.

Reacting to potential budget cap breaches

With AWS Budgets, you can make sure that the unfortunate scenario of exceeding your budget never happens. This convenient tool can notify you if you’re close to the budget limit so you can take immediate action to prevent going over. This means you can avoid unpleasant surprises at the end of each billing period and maintain granular insight into your expenses at all times.

What is AWS Cost Explorer?

AWS Cost Explorer is a tool for analyzing your AWS costs and resource usage. Think of it as your personal financial analyst—by examining your data, AWS Cost Explorer compiles and presents all cost and usage info. You need this tool if you:

• Want to identify spending trends and patterns

• Detect cost anomalies

• Understand your costs and their most important drivers

Here’s an example of how you can take advantage of AWS Cost Explorer:

1. Finding desired info: You’re analyzing your AWS costs and want to see how much you’ve spent in the previous month to pinpoint the most important cost drivers. You head to the Cost Explorer and select the period you’re interested in.

2. View costs by service: AWS Cost Explorer lets you filter your costs by service, giving you instant insight into the most expensive services.

3. Optimizing costs: You realize that Amazon Virtual Private Cloud (VPC) is your main cost driver. You can now examine VPC usage and eliminate any unused instances to optimize your expenses.

What are the use cases of AWS Cost Explorer?

Here’s what you can use AWS Cost Explorer for:

Visualizing costs

AWS Cost Explorer can help you put a spotlight on any AWS cost. You can use graphs and tables and plenty of filtering options to zero in on your AWS expenses, gain quick insights, and simplify the analysis of more complex cost data.

Cost forecasting

AWS Cost Explorer analyzes past data to identify patterns and predict future costs. This information helps you plan ahead and make informed decisions about AWS usage.

Analyzing cost data with AI

You can use Amazon Q Developer (AI-powered conversational assistant) to analyze your costs effortlessly. The best part is—you can use natural language. Here are some examples of the questions Amazon Q Developer can answer within seconds:

• What were my costs for Q3?

• What is our cost forecast for this month?

• What were my three most expensive services in August 2024?

What are the key AWS Budgets vs. Cost Explorer differences?

Let’s examine some of the key differences between AWS Budgets and Cost Explorer to clearly distinguish between the two services:

Customization

Both AWS Budgets and Cost Explorer have rich customization options to help you make the most out of your cloud services. But, the type of customization you’ll get with both is different since the services have different purposes.

For instance, with AWS Budgets, you can create different types of budgets to zero in on what interests you the most. Here are some examples:

AWS Budgets also allows you to set up custom alerts to receive notifications whenever you get close to a budget threshold. You can choose when to receive the ping (for example, when you reach 70% of your budget limit) to make sure you have enough time to react.

You can then set up custom actions to trigger automatically or with your approval when your budget exceeds a specific threshold.

AWS Cost Explorer has a different set of customization options. For example, you can use advanced filtering and grouping to get detailed info on the costs you’re interested in. You can filter your costs by Availability Zone, linked account, resources, service, etc.

With AWS Cost Explorer, you also get access to custom reports—choose the desired report type and configure settings to receive in-depth insights on specific costs.

Approach to cost and usage details 

Both tools let you zero in on cost and usage, but they have different approaches to it.

AWS Budgets allows you to track cost and usage by setting different types of budgets and then observing how close you get to their limits or how much you exceed them within a specific period. For example, you can set a monthly cost budget with a fixed target amount to track costs. Then, you can customize alerts to receive pings on forecasted and actual usage and compare that with your set budget.

AWS Cost Explorer gives you an overview of cost and usage patterns—it dives into past data to identify trends. Based on this information, Cost Explorer can forecast cost and usage for a specific time range and generate custom reports to help you accurately estimate your expenses. Using Cost Explorer’s preconfigured views, you can explore cost and usage data in more detail and zoom in on the info you’re interested in.

Alerts

Both AWS Budgets and Cost Explorer offer alerts, but they serve specific purposes.

With AWS Budgets, you can set budget alerts. These can notify you when you:

1. Get close to the pre-defined budget threshold

2. Exceed the set budget threshold

Alerts in Cost Explorer are more focused on detecting unusual expenses. This is possible thanks to a feature called AWS Cost Anomaly Detection. It uses machine learning models and Cost Explorer data to identify spending patterns and notify you if there’s anything out of the ordinary. While useful, keep in mind that this feature can have up to a 24-hour delay in detecting anomalies after they occur.

Update frequency

Update frequency is an essential factor when managing budgets and costs because it dictates the “freshness” of the available information. 

AWS Budgets is updated three times a day, and updates usually occur between eight and 12 hours after the last update.

AWS Cost Explorer refreshes your cost info at least once every 24 hours, which can cause delays in your cost-related decision-making. Keep in mind that some data may take longer than 24 hours to update.

Data focus

AWS Budgets is more concerned about understanding your forecasted budgets and actual costs and usages, so it’s more future-oriented.

Cost Explorer focuses more on the past. It can access up to 13 months of historical data and identify patterns and trends that can be useful for more accurate cost management in the future. Based on historical data, the tool can forecast how much you’re likely to spend in the next 12 months and even recommend how to take advantage of Reserved Instances to optimize spending.

Pricing

With AWS Budgets, you get access to budgets without actions for free, and you can also set two actions-enabled budgets at no cost. Here’s a general overview of the charges you might face:

AWS Cost Explorer allows you to view your cost and usage data free of charge, but you’ll have to pay for the following:

Customer stories

Curious about how AWS Budgets and Cost Explorer can help you manage costs? Check out the three customer stories to see how these services benefited companies:

Medibank & AWS Budgets

Medibank, a private health insurer from Australia, migrated its workloads to AWS and wanted to prioritize cost visibility and accountability while minimizing the risk of overspending. The company worked closely with AWS to build an advanced cost management solution to strengthen financial oversight and governance.

To track and allocate costs, Medibank used AWS Budgets to set budget thresholds and receive notifications whenever teams reached them. This proactive approach helped prevent budget overruns and ensured better financial control across the organization.

Alert Logic & AWS Cost Explorer

When it migrated to AWS, Alert Logic, a company delivering industry-leading managed security services, aimed to efficiently manage and optimize cloud costs.

One of the tools they turned to was AWS Cost Explorer, which allowed the company to visualize, understand, and forecast AWS costs and usage. With the help of the tool, Alert Logic was able to forecast usage for:

1. The next 12 months on a monthly basis

2. The next three months on a daily basis

By leveraging these insights, Alert Logic eliminated wasteful spending on unused instances and achieved fantastic results—reducing its AWS spend by 28%.

Verisk & AWS Budgets + Cost Explorer

Verisk is a strategic data analytics and technology partner to the global insurance industry. As the company was already using AWS, it wanted to gain deeper insights into its cloud usage and cost analytics. It adopted various AWS Cloud Financial Management suite solutions, including AWS Budgets and Cost Explorer.

The company used AWS Budgets to:

1. Set cloud spending targets

2. Track actual cost and usage against the budget thresholds

To get a clear overview of the costs and forecast resource usage over time, Verisk used AWS Cost Explorer.

AWS Budgets, Cloud Explorer, and other tools from the Cloud Financial Management suite helped Verisk optimize its cloud costs while maintaining top-level app performance.

Estimate cloud costs effortlessly with Miro

AWS Budgets and Cost Explorer are incredibly useful for cost and budget management, but it can take some time and effort to master their various features. If you’re after a more intuitive solution that lets you optimize AWS costs, visualize your entire cloud architecture, and collaborate with your team from a single location—Miro might be just what you need.

When it comes to cost optimization, you’ll especially love Miro’s AWS Cost Calculator, as it lets you:

• Estimate and optimize AWS service costs: Select the AWS resource you’re interested in, specify details like storage type and Region, and get precise cost estimations.

• View the calculations behind estimated prices: See more details for every estimated price and enjoy the transparency. You can view price estimates by service or groups of services for accurate architecture cost analysis.

• Compare multiple estimations side by side: Visualize different cost estimations side by side to understand how specific configurations affect the final price and make changes to fit your budget.

• Update your AWS architecture: Regularly monitor and compare costs to optimize your cloud spending and prevent wasting money on unnecessary configurations.

To use the AWS Cost Calculator, you only need to launch the feature within your Miro board and click and drag to select all AWS icons in your AWS diagram.

This all sounds great, but how do you create a diagram of your AWS cloud architecture in the first place? Miro can help with that as well.

The platform is an Innovation Workspace with a bunch of convenient options for visualizing all components of your cloud architecture, including:

• AWS Cloud View app: Connect Miro to your AWS account, import your data, and watch the magic happen as the Cloud View app generates a diagram of your AWS architecture within seconds.

• AWS shape pack: Miro offers a vast library of standard AWS icons to make diagramming even easier.

• Diagram focus mode: Handy features like a curated toolbar and layouts help you simplify diagramming.

• Rich collaboration options: Miro’s infinite canvas allows real-time collaboration so that you can work more efficiently. For async work, Miro offers Talktrack, an option that lets you create interactive recordings.

• Diagramming templates: Save time and visualize your AWS systems with one of Miro’s 13+ diagramming templates

Ready to estimate your AWS costs with maximum precision and create an incredible architecture diagramming experience? Sign up for a free Business trial and explore Miro’s AWS features.

If you’re not sure how Miro can help you, check out ClickHouse’s first-hand experience with the platform and discover how the company was able to speed up feature development and improve collaboration.