As more and more organizations rely on Amazon Web Services (AWS) to drive their digital presence, controlling the cloud expenses is now a prime concern. Two of the most widely used cost-saving methods—AWS Savings Plans and Reserved Instances (RIs)—provide substantial discounts compared to on-demand prices, but operate differently and are appropriate for different scenarios. So, which one saves you more?
In this blog, we dissect the most important differences between AWS Savings Plans and Reserved Instances to assist you in making the wisest financial and architectural decision for your business. This advice is especially crucial for businesses working with AWS cloud consulting services or seeking to collaborate with AWS consulting firms for long-term cloud strategies.
Understanding the Basics
What Are AWS Reserved Instances?
Reserved Instances allow you to reserve capacity for EC2 instances over a one- or three-year term, with options for all upfront, partial upfront, or no upfront payments. RIs offer significant discounts—up to 72%—compared to on-demand pricing.
Two types exist:
- Standard RIs: Provide the greatest savings but are inflexible—you can’t alter the instance family or region after buying.
- Convertible RIs: Offer greater flexibility by enabling you to swap for other instance types, operating systems, or tenancies within the term. The compromise is slightly reduced savings (up to 66%).
What Are AWS Savings Plans?
Released to offer more flexibility, AWS Savings Plans enable the customers to commit to a specific dollar amount (e.g., $100/hour) of compute use for a period, instead of being locked into a specific instance type.
They come in two flavors:
- Compute Savings Plans: Offer the most flexibility. They are applicable on any region, instance family, operating system, or even AWS service such as Fargate and Lambda. The customer receives up to 66% savings according to analysis.
- EC2 Instance Savings Plans: These provide a little better savings (similar to Standard RIs) but are tied to a particular instance family within a region.
Which One Saves You More?
The direct answer is that it depends on the workload predictability and flexibility requirements.
Let’s take a feature by feature comparison:
- Let’s assess the maximum discount initially. For reserved instance it is up to 72% and for saving plans it’s up to 66%
- When coming to Flexibility, RI offers Low (Standard) to Medium (Convertible) where as saving plans offers High (Compute) and Medium (EC2 Instance)
- In case of ScopeRI has only EC2 but saving plan holds EC2, Fargate and Lambda (Compute Plans)
- About the Commitment, RI has a specific instance, OS, and region. Savings plan has Dollar/hour commitment
- The Ideal Use Case of RI is forStatic and predictable workloads. In case of saving plans its for Dynamic or evolving workloads
- In Payment Terms they align as they have All, Partial and No upfront payments involved
When having a look at some real life use cases,
- A healthcare company running the same EC2 instances 24/7 for three years can maximize cost savings with Standard Reserved Instances.
- A fast-scaling SaaS startup with evolving architecture might benefit more from the flexibility of Compute Savings Plans.
Strategic Recommendations from our AWS Experts
An increasing number of companies depend on AWS consulting partners to lead them through cost-optimization planning. An ideal strategy typically integrates both Reserved Instances and Savings Plans for the best outcome:
- Baseline Usage: Included in Standard or Convertible RIs.
- Variable Workloads: Controlled using Compute Savings Plans for flexibility.
Our experienced AWS managed service provider will normally look at your historical usage and estimate future trends and suggest a commitment strategy that maximizes savings with minimal waste.
How AWS Consulting Companies Maximize ROI?
Choosing between Savings Plans and RIs is only one part of the cost optimization equation. Leading AWS consulting firms bring strategic value by:
- Operating cost simulation models to forecast results of each pricing approach.
- Enabling automation for buying and changing commitments.
- Tracking idle resources and optimizing allocation.
These services prevent businesses from making the all-too-frequent error of overcommitting on resources or not being able to take advantage of flexible savings opportunities because of overly rigid planning.
Additionally, AWS cloud consulting services usually combine governance and compliance monitoring with cost control—a key consideration for regulated sectors such as finance or healthcare.
Final Thoughts
Choosing between AWS Savings Plans and Reserved Instances depends on your organization’s infrastructure maturity, predictability of workloads, and growth trajectory. A hybrid strategy—using both options where they fit best—often delivers the highest savings with the least risk.
Partnering with an authorized AWS consulting partner or seasoned AWS managed service provider guarantees you are not only cutting costs but also doing so while maintaining scalability, resilience, and agility.
