How to Reduce Cost in Azure: Tips and Best Practices for business and private purposes

By following these tips and best practices, you can reduce your Azure spending and optimize your resources, regardless of whether you’re working in a test or production environment. However, it’s important to carefully consider your workload requirements and ensure that any cost-saving measures do not compromise your performance or reliability.

1. Use the Azure Cost Management and Billing Tool to track your usage and costs in real-time, set budget alerts, get emails regarding cost and optimize your spending with recommendations for cost savings. This tool is useful for both test environments and production environments.
2. Use Reserved Instances to commit to a one- or three-year term for your VMs and save up to 72% on costs compared to pay-as-you-go pricing. Reserved Instances can be a cost-effective option for workloads that are expected to run for a longer period of time. This tip is most applicable for production environments.
3. Use Spot VMs for non-critical workloads to take advantage of unused Azure capacity and get up to 90% cost savings compared to pay-as-you-go pricing. However, Spot VMs are not guaranteed to be available at all times and can be reclaimed by Azure with 30 seconds’ notice. Therefore, they may not be appropriate for all workloads. This tip is most applicable for test environments.
4. Use Auto Scaling to automatically adjust the number of VMs in your environment based on workload demands. By using Auto Scaling, you can avoid over-provisioning VMs, which can lead to higher costs. Additionally, Auto Scaling can help ensure that your workloads are always running optimally, without incurring unnecessary costs. This tip is useful for both test and production environments.
5. Use Azure Hybrid Benefit to use your existing licenses for Windows Server or SQL Server on Azure at a reduced cost. By taking advantage of this benefit, you can save up to 40% on VM costs. This can be a great option for organizations that have existing licenses and want to use them on Azure. This tip is applicable for both test and production environments.
6. Delete Unused Resources, such as VMs, storage accounts, and databases, to reduce unnecessary costs. It’s important to regularly review your Azure resources and delete any that are no longer needed. By deleting unused resources, you can reduce your Azure spending and avoid unexpected charges. This tip is applicable for both test and production environments.
7. Choose the Right Disk Type based on your workload requirements and select the most cost-effective option that meets your needs. For example, Standard SSD disks offer a balance of performance and cost, while Premium SSD disks provide the highest performance but at a higher cost. Additionally, using Azure Blob Storage or Azure Files for storing large amounts of data can be a cost-effective option compared to using Azure disks. This tip is applicable for both test and production environments.
8. Choose the Right VM Size based on your workload requirements and select the most cost-effective option that meets your needs. Choosing a smaller VM size can help reduce costs, but it’s important to ensure that the VM can handle your workload without performance issues. This tip is applicable for both test and production environments.