Savings Plans vs Reserved Instances on AWS
Compare flexibility, discount depth, and break-even.
Commitment Discounts: Two Paths to Save
AWS offers two commitment-based pricing models: Savings Plans and Reserved Instances (RIs). Both provide significant discounts (up to 72%) over On-Demand pricing, but they work differently. Choosing the right one depends on your workload flexibility and growth plans.
Key Differences
| Feature | Savings Plans | Reserved Instances |
|---|---|---|
| Commitment | $/hour spend | Specific instance type |
| Flexibility | Any instance family, region, OS | Locked to instance type (Standard) or family (Convertible) |
| Max Discount | Up to 72% | Up to 72% |
| Term | 1 or 3 years | 1 or 3 years |
| Applies To | EC2, Fargate, Lambda | EC2 only |
| Best For | Dynamic, growing workloads | Stable, predictable workloads |
When to Choose Savings Plans
- You're migrating to Graviton or changing instance families
- You use Fargate or Lambda alongside EC2
- Your workload distribution changes across regions
- You want simplicity — one commitment covers everything
When to Choose Reserved Instances
- You have databases or stateful workloads on fixed instance types
- You need capacity reservations (only RIs guarantee capacity)
- You want to sell unused commitments on the RI Marketplace
Break-Even Analysis
Both options require you to commit for 1 or 3 years. The break-even point for a 1-year No Upfront commitment is typically around 7-8 months. If you expect to use the resources for at least that long, commitments make sense.
Our Recommendation
For most SMBs, we recommend a layered approach:
- Cover 60-70% of your baseline compute with Compute Savings Plans
- Add Reserved Instances for stable databases (RDS RIs)
- Use Spot for batch, CI/CD, and non-critical workloads
- Leave 10-20% as On-Demand for burst capacity
Eazy SaaS Tip: Use the AWS Cost Explorer "Savings Plans Recommendations" page. It analyzes your past 30-60 days of usage and suggests the optimal hourly commitment amount.