Your AWS bill looks tiny. You feel safe. Then one day the credits end and the number jumps 10 times higher. That shock is the AWS cliff.
Many startups live on AWS credits for a year or two. Some get tens of thousands of dollars in free usage from startup programs, proof‑of‑concept funds, or Well‑Architected reviews. Credits work like a prepaid balance, so real prices stay hidden in the background.
When those credits expire, the bill hits full price. If you have not prepared, that jump can wreck your forecast and send your team into panic mode. The good news is you can plan for this. A few months before credits run out, you can follow a simple playbook, rightsize your workloads, clean up waste, and choose smart Savings Plans so the move from free to paid feels calm, not scary.
Why the AWS “Cliff” Hurts So Much (And When It’s Coming)
The AWS cliff happens when your usage grows while credits cover most of the cost. Your team sees a low bill and keeps shipping features, adding services, and spinning up bigger machines. On paper, everything looks cheap.
But the meter is always running at full list price. Credits just subtract that cost before you see it. When those credits expire, the bill stops being shielded. You go from “almost free” to “real enterprise bill” in a single cycle.
Startup offers often give up to $100,000 in credits that last from 6 to 24 months. There can also be extra bundles, like proof‑of‑concept credits for new projects or Well‑Architected review credits for important workloads. These are great for growth, but they also stretch the cliff farther out, so it is easier to ignore.
If you wait until the last week before expiration, you are stuck. You cannot safely rightsize, you cannot test changes, and you panic‑buy Savings Plans based on a bloated footprint. The smart move is to start fixing things when you still have 3 to 6 months of credits left.
How free AWS credits hide your real cloud spend
When AWS feels “free,” founders and engineers stop thinking about price. You just swipe a card for a tiny bill and move on with your day.
So people:
- Choose bigger instances “just in case”
- Leave staging and demo environments running all night
- Skip tagging, so nobody knows which workload belongs to which team
- Delay cost reviews because credits still cover most of it
Picture a small SaaS startup. They have production, staging, a demo environment for sales, and a playground for experiments. All of them run on large instances, with databases sized for traffic they do not yet have. While they still have $40,000 in credits, nobody complains.
If those credits vanished today, that same setup could cost thousands each month. The usage was always there. The pain was not.
Warning signs your credits are about to run out
Watch for these signals:
- Emails from AWS about credits that expire in a few months
- The “credits remaining” number shrinking fast in the Billing console
- New projects launching right before credits end, with no cost review
- Finance asking, “What will our AWS bill be when this is not free?”
Once you see these signs, treat it as your start gun. You still have time to fix things.
Rightsize Before It Hurts: A Simple AWS Cleanup Playbook
This is where you turn a scary cliff into a small step. The goal is simple: shrink your real monthly cost before credits end.
You do not need deep cloud expertise for this. If you can open the AWS console and read a graph, you can start.
Step 1: Find your real baseline cost while you still have credits
First, you need to know what AWS would charge with no credits at all.
Open the Billing console and:
- Look at total spend for the last full month
- Check the amount before credits are applied, not the final bill
- In Cost Explorer, review “unblended cost” or the simple total by service
Focus on your top 3 to 5 services. For most teams this means EC2, RDS, S3, and data transfer or CloudFront. These are usually the heavy hitters.
Write those numbers down. This is your honest baseline, the bill you will pay once credits hit zero. Every action in the rest of this playbook should lower that number.
Step 2: Kill unused and idle resources (the fastest savings)
Now you grab the lowest hanging fruit. You are looking for things that are:
- Not used at all
- Used only during work hours
- Left behind after past projects
Run a quick cleanup:
- Shut down old test and demo environments that nobody touches
- Stop or schedule dev and staging instances so they run only during the day
- Delete snapshots, AMIs, and backups you no longer need
- Remove unattached EBS volumes and idle load balancers
These changes are low risk because they do not touch live customer traffic. They cut cost quickly because idle resources still charge you for storage, instances, and IPs.
After a week, check your projected spend again. You should already see your future post‑credit bill drop.
Step 3: Rightsize overpowered instances and databases
Next, deal with resources that are used, but oversized.
Rightsizing means matching machine size to what you actually use. Many workloads sit at 5 to 10 percent CPU and very low memory, on instances that are two sizes too big.
Here is a simple process:
- In CloudWatch, check average CPU and memory for your EC2 instances and RDS databases
- Flag anything that runs under about 30 percent CPU most of the time
- Try moving those to the next smaller size and watch performance
A good target for steady workloads is 40 to 60 percent typical CPU. That gives you room for spikes without paying for mostly empty capacity.
Look at:
- EC2 instances that run all the time
- RDS databases that rarely face heavy queries
- ECS or EKS tasks that sit idle for much of the day
Change a few services at a time, then recheck metrics. Rightsizing can cut compute and storage costs by large amounts, especially if you started with generous instance choices during your “free” period.
From Short-Term Fix to Long-Term Plan: Savings Plans and Lean Habits
Once you clean up and rightsize, your baseline bill is lower and more stable. Now you can lock in discounts without trapping yourself in bad commitments.
You can also add more savings through startup offers, credits for reviews, or negotiated discounts. Platforms like Spendbase help teams stack credits and even get an AWS discount program – up to 3% off their budget. You can Explore AWS discounts to see what is available on top of your own tuning.
How to choose the right AWS Savings Plan without overcommitting
Savings Plans are simple at a high level. You promise to spend a steady amount per hour for 1 or 3 years, and AWS gives you a lower rate on that usage.
To keep it safe:
- Finish your cleanup first so your baseline is accurate
- Look at your “always on” usage over the last 1 to 3 months
- Start with a 1‑year, no‑upfront plan
- Cover only 50 to 70 percent of that steady usage, not your peak
This way, you still get a lower rate for the core of your workload, but you do not trap yourself if traffic drops or you refactor.
Keep bursty, short‑term, or experimental workloads on on‑demand pricing. It is better to pay full price for a small, spiky slice than to lock in too much commitment.
Keep non-essential workloads lean so your AWS bill stays flat
The cliff can return if your usage grows without guardrails. A few simple habits keep things under control:
- Tag resources by environment, like
prod- ,
staging- , and
dev- Set schedules so non‑production resources shut down at night and weekends
- Review your top 10 cost items once a month as a team
- Agree which workloads are “must have” and which can shrink during tight months
These habits keep your bill tied to real value, not careless growth.
Conclusion
The AWS cliff only feels deadly when it catches you off guard. Your credits hide the true bill for months, then vanish overnight, and the number on the invoice can shake your whole budget.
You can flip that story. Measure your real cost while credits are still active, clean out waste, rightsize machines and databases, then add smart Savings Plans and extra AWS credits or discounts on top. Turn a surprise bill into a planned, steady expense.
Pick one step from this playbook this week. Kill a stale test environment, or schedule dev to shut off at night. By the time your credits expire, your AWS bill should feel like just another line item, not a cliff.
