Budgets and cost anomaly detection in AWS - Step-by-Step Execution

Process Flow - Budgets and cost anomaly detection

Set Budget Amount

↓

Define Budget Scope

↓

Set Alerts Thresholds

↓

Monitor AWS Costs

↓

Detect Anomalies?

No→Continue Monitoring

Yes↓

Send Alert Notification

↓

Review and Adjust Budget

This flow shows how you set a budget, monitor costs, detect anomalies, and get alerts to manage AWS spending.

Execution Sample

AWS

1. Create budget with $100 limit
2. Set alert at 80% usage
3. Monitor daily costs
4. Detect cost anomaly
5. Send alert email

This example sets a budget, watches costs, detects unusual spikes, and sends alerts.

Process Table

Step	Action	Budget State	Cost Data	Anomaly Detected	Alert Sent
1	Create budget $100	Budget=$100, Alert=80%	No cost data yet	No	No
2	Monitor costs day 1	Budget=$100, Alert=80%	Cost=$20	No	No
3	Monitor costs day 2	Budget=$100, Alert=80%	Cost=$50	No	No
4	Monitor costs day 3	Budget=$100, Alert=80%	Cost=$85	No	Alert threshold crossed, alert sent
5	Detect anomaly day 4	Budget=$100, Alert=80%	Cost spike to $130	Yes	Anomaly alert sent
6	Review budget	Budget=$100, Alert=80%	Cost=$130	Yes	Alert sent
7	Adjust budget or investigate	Budget adjusted or issue investigated	Cost monitored	No	No

💡 Process continues with monitoring and alerts as costs change or anomalies detected

Status Tracker

Variable	Start	After Step 2	After Step 3	After Step 4	After Step 5	Final
Budget Limit	$100	$100	$100	$100	$100	Adjusted or $100
Alert Threshold	80%	80%	80%	80%	80%	80%
Cost	$0	$20	$50	$85	$130	Monitored
Anomaly Detected	No	No	No	No	Yes	No or Yes
Alert Sent	No	No	No	Yes	Yes	No or Yes

Key Moments - 3 Insights

Why is an alert sent at step 4 even though no anomaly is detected?

At step 4, the cost reached 85 which is above the 80% alert threshold, triggering a budget alert, but no unusual pattern (anomaly) was detected yet. See execution_table row 4.

What triggers the anomaly detection at step 5?

At step 5, the cost suddenly spikes to $130, exceeding the budget and normal usage patterns, triggering anomaly detection and an alert. See execution_table row 5.

Can the budget be adjusted after alerts?

Yes, after alerts, you can review and adjust the budget or investigate costs to control spending. See execution_table row 7.

Visual Quiz - 3 Questions

Look at the execution_table, what is the cost at step 3?

A $20

B $50

C $85

D $130

💡 Hint

Check the 'Cost Data' column at step 3 in the execution_table.

At which step is an anomaly first detected?

A Step 5

B Step 4

C Step 3

D Step 2

💡 Hint

Look at the 'Anomaly Detected' column in the execution_table.

If the alert threshold was set to 90%, at which step would the first alert be sent?

A Step 4

B Step 3

C Step 5

D No alert would be sent

💡 Hint

Compare the cost values with the alert threshold in the execution_table.

Concept Snapshot

Budgets and cost anomaly detection in AWS:
- Set a budget limit and alert thresholds
- Monitor daily AWS costs
- Alerts trigger when costs exceed thresholds
- Anomaly detection finds unusual cost spikes
- Alerts notify to review or adjust budgets
- Helps control cloud spending effectively

Full Transcript

This visual execution shows how AWS Budgets and Cost Anomaly Detection work together. First, you create a budget with a set limit and alert threshold. Then daily costs are monitored. When costs cross the alert threshold, an alert is sent. If costs spike unusually, anomaly detection triggers an anomaly alert. You then review costs and adjust budgets or investigate. This process repeats to help manage cloud spending and avoid surprises.

Practice

1. What is the main purpose of AWS Budgets in cloud cost management?

easy

A. To automatically reduce cloud service prices

B. To create backups of billing data

C. To set spending limits and receive alerts when costs approach those limits

D. To monitor network traffic between AWS services

Solution

1. Step 1: Understand AWS Budgets function

   AWS Budgets allow users to set cost or usage limits and get alerts when those limits are near or exceeded.

2. Step 2: Compare options to this function

   Only To set spending limits and receive alerts when costs approach those limits describes setting limits and alerts, which matches AWS Budgets' purpose.

3. Final Answer:

   To set spending limits and receive alerts when costs approach those limits -> Option C

4. Quick Check:

   AWS Budgets = Spending limits and alerts [OK]

Hint: Budgets set limits and alert you before overspending [OK]

Common Mistakes:

• Thinking Budgets automatically reduce costs
• Confusing Budgets with backup or network tools
• Assuming Budgets monitor traffic instead of costs

2. Which of the following is the correct way to create a cost anomaly detection monitor using AWS CLI?

easy

A. aws ec2 create-anomaly-monitor --name MyMonitor

B. aws ce create-budget --name MyMonitor

C. aws ce start-anomaly-monitor --monitor-name MyMonitor

D. aws ce create-anomaly-monitor --monitor-name MyMonitor

Solution

1. Step 1: Identify correct AWS CLI command for anomaly monitor

   The AWS Cost Explorer (ce) service uses 'create-anomaly-monitor' to create anomaly monitors.

2. Step 2: Check options for correct syntax and service

   aws ce create-anomaly-monitor --monitor-name MyMonitor uses 'aws ce create-anomaly-monitor' with correct parameter '--monitor-name'. Others use wrong commands or services.

3. Final Answer:

   aws ce create-anomaly-monitor --monitor-name MyMonitor -> Option D

4. Quick Check:

   Correct CLI command for anomaly monitor creation = aws ce create-anomaly-monitor --monitor-name MyMonitor [OK]

Hint: Use 'aws ce create-anomaly-monitor' to create monitors [OK]

Common Mistakes:

• Using 'create-budget' instead of anomaly monitor command
• Using EC2 service commands for cost anomaly detection
• Incorrect parameter names like '--name' instead of '--monitor-name'

3. Given this AWS CLI command output snippet for a cost anomaly detection alert:

{
  "AnomalyId": "12345",
  "AnomalyScore": 85,
  "Service": "Amazon S3",
  "StartTime": "2024-05-01T00:00:00Z",
  "EndTime": "2024-05-01T23:59:59Z"
}

What does the AnomalyScore of 85 indicate?

medium

A. A high likelihood of cost anomaly

B. A moderate likelihood of cost anomaly

C. A low likelihood of cost anomaly

D. An error in anomaly detection

Solution

1. Step 1: Understand AnomalyScore meaning

   AnomalyScore ranges from 0 to 100; higher scores mean higher likelihood of unusual cost behavior.

2. Step 2: Interpret score 85

   Score 85 is close to 100, indicating a high likelihood of a cost anomaly.

3. Final Answer:

   A high likelihood of cost anomaly -> Option A

4. Quick Check:

   High AnomalyScore means high anomaly chance [OK]

Hint: Higher AnomalyScore means stronger anomaly signal [OK]

Common Mistakes:

• Thinking 85 is low or moderate score
• Confusing AnomalyScore with error codes
• Ignoring the score scale from 0 to 100

4. You created a budget with this AWS CLI command:

aws budgets create-budget --account-id 123456789012 --budget '{"BudgetName":"MyBudget","BudgetLimit":{"Amount":"100","Unit":"USD"},"TimeUnit":"MONTHLY","BudgetType":"COST"}'

But you receive an error. What is the most likely cause?

medium

A. Missing required parameter --notifications-with-subscribers

B. Incorrect JSON format for the budget parameter

C. Using --account-id instead of --account-id is invalid

D. BudgetLimit Amount must be an integer, not a string

Solution

1. Step 1: Check JSON format in --budget parameter

   The JSON string uses double quotes inside single quotes but may have formatting issues or missing escapes.

2. Step 2: Identify common CLI JSON errors

   Incorrect JSON formatting or missing escapes cause CLI errors; the command likely fails due to this.

3. Final Answer:

   Incorrect JSON format for the budget parameter -> Option B

4. Quick Check:

   JSON format errors cause CLI command failures [OK]

Hint: Validate JSON syntax carefully in CLI commands [OK]

Common Mistakes:

• Assuming missing notifications cause errors
• Confusing parameter names like --account-id
• Thinking Amount must be integer, but string is allowed

5. You want to monitor your AWS costs and get notified only when unusual spending spikes happen in specific services tagged with Environment=Production. Which combination of AWS features should you use?

hard

A. Create a cost anomaly detection monitor filtered by tag and set SNS notifications for alerts

B. Create a budget with a fixed limit and enable email alerts for all costs

C. Use AWS CloudTrail to track cost changes and send alerts via Lambda

D. Set up AWS Config rules to monitor cost and trigger alarms

Solution

1. Step 1: Identify feature for unusual spending spikes

   Cost anomaly detection monitors unusual cost spikes, suitable for this use case.

2. Step 2: Use tags to filter specific services and set notifications

   Filtering by tag 'Environment=Production' and using SNS notifications matches the requirement.

3. Final Answer:

   Create a cost anomaly detection monitor filtered by tag and set SNS notifications for alerts -> Option A

4. Quick Check:

   Cost anomaly + tag filter + SNS alerts = Create a cost anomaly detection monitor filtered by tag and set SNS notifications for alerts [OK]

Hint: Use anomaly detection with tag filters and SNS for targeted alerts [OK]

Common Mistakes:

• Using budgets which alert on fixed limits, not anomalies
• Confusing CloudTrail or Config with cost anomaly detection
• Ignoring tag filtering for specific environment costs