Setting up billing alerts in AWS - Try It Yourself

Setting up billing alerts

📖 Scenario: You are managing cloud costs for a small company. To avoid unexpected charges, you want to set up billing alerts that notify you when your AWS costs exceed a certain amount.

🎯 Goal: Create a billing alert using AWS CloudWatch that sends an email notification when the estimated charges exceed $50.

📋 What You'll Learn

Create a CloudWatch billing alarm for estimated charges

Set the threshold to $50

Configure an SNS topic for email notifications

Subscribe your email to the SNS topic

💡 Why This Matters

🌍 Real World

Cloud cost management is critical for businesses to avoid unexpected charges and optimize spending.

💼 Career

Cloud engineers and administrators often set up billing alerts to monitor and control cloud expenses proactively.

1

Create an SNS topic for billing alerts

Create an SNS topic named BillingAlerts using AWS CLI or AWS Console.

AWS

# Create an SNS topic named BillingAlerts
# Your code here

Hint

Use the AWS CLI command aws sns create-topic --name BillingAlerts to create the topic.

2

Subscribe your email to the SNS topic

Subscribe your email address [e-mail] to the SNS topic BillingAlerts to receive notifications.

AWS

aws sns create-topic --name BillingAlerts
# Subscribe your email [e-mail] to BillingAlerts
# Your code here

Hint

Use aws sns subscribe with --protocol email and your email address.

3

Create a CloudWatch billing alarm

Create a CloudWatch alarm named BillingAlarm that monitors the metric EstimatedCharges in the AWS/Billing namespace. Set the threshold to 50 USD and use the BillingAlerts SNS topic ARN for notifications.

AWS

aws sns create-topic --name BillingAlerts
aws sns subscribe --topic-arn arn:aws:sns:us-east-1:123456789012:BillingAlerts --protocol email --notification-endpoint [e-mail]
# Create CloudWatch alarm BillingAlarm for EstimatedCharges with threshold 50
# Your code here

Hint

Use aws cloudwatch put-metric-alarm with the specified parameters to create the alarm.

4

Verify billing alert setup

Verify that the CloudWatch alarm BillingAlarm is created and linked to the SNS topic BillingAlerts by listing your CloudWatch alarms.

AWS

aws sns create-topic --name BillingAlerts
aws sns subscribe --topic-arn arn:aws:sns:us-east-1:123456789012:BillingAlerts --protocol email --notification-endpoint [e-mail]
aws cloudwatch put-metric-alarm --alarm-name BillingAlarm --metric-name EstimatedCharges --namespace AWS/Billing --statistic Maximum --period 21600 --evaluation-periods 1 --threshold 50 --comparison-operator GreaterThanOrEqualToThreshold --alarm-actions arn:aws:sns:us-east-1:123456789012:BillingAlerts --unit None
# List CloudWatch alarms to verify BillingAlarm exists
# Your code here

Hint

Use aws cloudwatch describe-alarms --alarm-names BillingAlarm to check the alarm.

Practice

1. What is the primary purpose of setting up billing alerts in AWS?

easy

A. To disable services when spending is high

B. To automatically increase your cloud budget

C. To get notified when your cloud spending reaches a certain limit

D. To get detailed logs of all service usage

Solution

1. Step 1: Understand billing alerts purpose

   Billing alerts notify you when your spending reaches a set threshold to help control costs.

2. Step 2: Compare options

   Only To get notified when your cloud spending reaches a certain limit describes notification on spending limits; others describe unrelated actions.

3. Final Answer:

   To get notified when your cloud spending reaches a certain limit -> Option C

4. Quick Check:

   Billing alerts = notifications on spending [OK]

Hint: Billing alerts notify you about spending limits reached [OK]

Common Mistakes:

• Thinking alerts automatically change budgets
• Confusing alerts with service shutdown
• Assuming alerts provide detailed usage logs

2. Which AWS service is used to create billing alerts easily?

easy

A. Amazon S3

B. AWS CloudTrail

C. AWS Lambda

D. AWS Budgets

Solution

1. Step 1: Identify service for billing alerts

   AWS Budgets is designed to create budgets and alerts for billing thresholds.

2. Step 2: Eliminate unrelated services

   CloudTrail tracks API calls, Lambda runs code, S3 stores data; none create billing alerts.

3. Final Answer:

   AWS Budgets -> Option D

4. Quick Check:

   AWS Budgets = billing alerts service [OK]

Hint: Use AWS Budgets to set billing alerts quickly [OK]

Common Mistakes:

• Choosing CloudTrail for billing alerts
• Confusing Lambda with alert setup
• Selecting S3 as billing alert tool

3. Given this AWS Budgets alert setup:
Threshold: 80% of $1000 budget
Notification: Email to [e-mail]
What triggers the alert?

medium

A. When spending reaches $800

B. When spending reaches $1000

C. When spending reaches $200

D. When spending reaches $1200

Solution

1. Step 1: Calculate 80% of $1000 budget

   80% of $1000 = 0.8 x 1000 = $800.

2. Step 2: Understand alert trigger

   The alert triggers when spending reaches $800, the threshold set.

3. Final Answer:

   When spending reaches $800 -> Option A

4. Quick Check:

   80% x 1000 = 800 [OK]

Hint: Multiply budget by threshold percent to find alert trigger [OK]

Common Mistakes:

• Using full budget amount instead of threshold
• Confusing 80% with 20%
• Choosing amounts above budget

4. You set a billing alert but never receive notifications. What is a likely cause?

medium

A. Your AWS account has no budget set

B. You did not verify the email address for notifications

C. Billing alerts only work with SMS, not email

D. Alerts only trigger after spending exceeds twice the budget

Solution

1. Step 1: Check notification setup requirements

   AWS requires email addresses to be verified before sending alerts.

2. Step 2: Evaluate other options

   A budget is required to create alerts; alerts support email notifications; alerts trigger when spending reaches the threshold, not after twice the budget.

3. Final Answer:

   You did not verify the email address for notifications -> Option B

4. Quick Check:

   Email verification needed for alerts [OK]

Hint: Verify email to receive AWS billing alerts [OK]

Common Mistakes:

• Assuming alerts work without email verification
• Thinking alerts only support SMS
• Believing alerts trigger only after double spending

5. You want to set a billing alert that notifies you by email when your AWS spending exceeds $500 and again at $750. How can you configure this using AWS Budgets?

hard

A. Create one budget with two notification thresholds: 50% and 75% of $1000 budget

B. Create two separate budgets each with one notification at $500 and $750

C. Create one budget with a single notification at $625 (average of $500 and $750)

D. Create one budget with a notification only at $750 and manually check for $500

Solution

1. Step 1: Understand AWS Budgets notification capabilities

   AWS Budgets allows multiple notification thresholds per budget.

2. Step 2: Apply thresholds to a single budget

   Set budget at $1000 with notifications at 50% ($500) and 75% ($750) to get alerts at both amounts.

3. Step 3: Evaluate other options

   Creating two budgets is unnecessary; a single notification at the average misses the exact alert points; manual checking is inefficient.

4. Final Answer:

   Create one budget with two notification thresholds: 50% and 75% of $1000 budget -> Option A

5. Quick Check:

   Multiple notifications per budget = correct setup [OK]

Hint: Use multiple thresholds in one budget for several alerts [OK]

Common Mistakes:

• Creating multiple budgets instead of multiple notifications
• Using average threshold instead of exact values
• Relying on manual checks instead of alerts