AWS Savings Plan is a flexible pricing model that can help reduce AWS bill by up to 72% compared to On-Demand prices, in exchange for a 1-year or 3-year hourly spend commitment. AWS offers three types of Savings Plans: Compute Savings Plans, EC2 Instance Savings Plans, and Amazon SageMaker Savings Plans. When you sign up for a Savings Plan, you will be charged at the Savings Plan price, which is inclusive of your savings rate, for usage up to your commitment. AWS recommends using Savings Plans instead of Reserved Instances .

Create Savings Plan

• Open AWS Cost Management console
• In navigation pane, select Savings Plans > Inventory
• Click Purchase a Savings Plan button
• For Savings Plan type, choose EC2 Instance Savings Plans
• For Term, choose 3-year
• For Region, choose US West (Oregon)
• For Instance family, choose t4g
• For Hourly commitment, enter $0.0038 for t4g.micro
• For Start date, choose appropriate Date & time
• For Payment option, choose All Upfront
• Click Add to cart button

Calculating Hourly Commitment

• Open AWS Savings Plan - Compute Pricing
• Go to section Compute Savings Plan for Amazon EC2
• For Location type, choose AWS Region
• For Region, choose US West (Oregon)
• For Term length, choose 3 years
• For Payment options, choose All Upfront
• For Operating system, choose Linux
• For Tenancy, choose Shared
• In search box, enter t4g
• for Instance name t4g.micro, find Savings Plans rate e.g. $0.0038
• Calculate total Hourly commitment, multiply number of instances by $0.0038
• Use this total Hourly commitment during purchase