July 13, 2023

What is AWS Free Tier? An In-Depth Look at Cost Savings

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By Andrei Maksimov

May 30, 2023

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Welcome to our comprehensive exploration of AWS Free Tier. If you’re new to cloud computing or just starting with Amazon Web Services (AWS), you’ve likely encountered references to the ‘AWS Free Tier.’ But what does this mean, and how can it help you? In this article, we will offer an in-depth understanding of AWS Free Tier and how you can utilize it to save costs and experiment with AWS’s extensive range of services.

AWS Free Tier is an impressive offering from Amazon, designed to help new users get started with AWS services without incurring high costs. It’s a wonderful opportunity for businesses and individuals to familiarize themselves with various AWS services, test them out, and determine what works best for their specific use cases before committing significant resources.

Moreover, this article goes beyond mere theoretical understanding. We will provide practical examples using Terraform and Python, two powerful tools that can streamline your AWS experience. Terraform, an open-source Infrastructure as Code (IaC) software tool, enables users to define and provide data center infrastructure using a declarative configuration language. On the other hand, Python is a versatile high-level programming language well-loved for its readability and broad application.

Using Terraform, we’ll illustrate how to deploy AWS resources, making the most of the AWS Free Tier. Similarly, with Python’s AWS SDK – Boto3, we will showcase how you can manage AWS services efficiently. Alternatively, you can install AWS CLI and manage AWS services within the free tier from your shell.

Whether you’re a seasoned developer, a startup looking for cost-effective ways to leverage AWS, or a curious learner wanting to dive into cloud computing, this article has something for you. So, let’s delve into AWS Free Tier and understand its benefits, limitations, and practical applications to enhance your AWS journey.

Understanding AWS Free Tier

Before we dive into how to get the most out of the AWS Free Tier, it’s essential to understand what it is and its various components. This knowledge will allow you to navigate the AWS landscape confidently, making informed decisions about what services to use and when.

What is AWS Free Tier?

The AWS Free Tier is an offering from Amazon Web Services that allows you to use certain AWS services for free, up to specific usage limits. It’s designed to give users—especially new users—an opportunity to explore and try out AWS services without any upfront costs. This offer is available to all AWS customers and is automatically activated upon setting up an AWS account.

The AWS Free Tier comprises three offerings

  • Always Free offer includes a set of AWS services that are free forever within specific usage limits
  • 12 Months Free offer valid for the first 12 months after you open your AWS account.
  • Trials offer free use of select AWS services up to certain limits or short-term free access to some AWS services.

Components of AWS Free Tier

The AWS Free Tier includes a broad selection of AWS services. However, the usage limits can vary significantly from one service to another. Here are the primary categories:

Compute: Services like Amazon EC2 and AWS Lambda fall into this category. With EC2, for example, under the Free Tier, users get up to 750 hours of EC2 running Linux, RHEL, or SLES t2.micro instance usage each month for the first 12 months. Similarly, AWS Lambda offers 1 million free requests per month and up to 3.2 million seconds of compute time per month.

Storage: This category includes services like Amazon S3, Amazon EBS, and Amazon RDS. For instance, S3 provides 5 GB of standard storage, 20,000 Get Requests, and 2,000 Put Requests.

Database: AWS provides limited free usage of database services like Amazon DynamoDB and Amazon RDS.

Data Transfer: This category covers the data transfer OUT from AWS to the internet.

In subsequent sections, we’ll see examples of deploying these AWS services using Terraform and managing them using Python. This hands-on approach will help us understand how to maximize the potential of AWS Free Tier effectively and practically.

In the next sections, we’ll look at the benefits of the AWS Free Tier, its limitations, and how to avoid unexpected charges. So, stay tuned to get the most out of your AWS Free Tier experience.

AWS Free Tier Benefits

The AWS Free Tier has many benefits that can help businesses, developers, and students. Let’s delve into the primary advantages of using the AWS Free Tier.

Cost Savings

The most apparent benefit of the AWS Free Tier is the cost savings. It allows you to use a range of AWS services for free up to certain limits. For instance, with services like EC2 and S3, you can create and maintain your server and storage solution without any upfront costs.

Consider the case of deploying an EC2 instance using Terraform. A t2.micro EC2 instance falls within the AWS Free Tier. By defining and deploying your infrastructure as code, you can manage AWS resources efficiently, keeping costs minimal.

The cost savings can be significant, especially for startups and small businesses operating on a tight budget, enabling you to use your resources elsewhere while still benefiting from the flexibility and scalability of AWS services.

Learning Opportunities

The AWS Free Tier also offers an excellent platform for learning. Whether you’re a student just starting with cloud computing or a developer wanting to get your hands dirty with new AWS services, the Free Tier allows you to learn and experiment without worrying about costs.

For example, you can use Python and its AWS SDK, Boto3, to interact with AWS services. You can create, manage, and delete AWS resources, helping you understand the intricacies of AWS management programmatically.

Experimenting with AWS Services

The AWS Free Tier isn’t just for learning; it’s also perfect for experimentation. With access to many AWS services, you can try different configurations and setups to understand what works best for your specific use case.

For instance, you could deploy a small-scale application using EC2 for computing, S3 for storage, and RDS for database management. All these services fall under the Free Tier, allowing you to experiment and gain practical experience without any cost.

In the upcoming sections, we will provide practical examples of managing AWS resources using Terraform and Python’s Boto3, enhancing your understanding and ability to experiment with AWS services effectively.

In summary, the AWS Free Tier is a cost-saving tool and a rich platform for learning and innovation. You can gain much knowledge, skills, and value by leveraging it to its full potential.

Limitations of AWS Free Tier

While the AWS Free Tier offers many benefits and is a great way to get started with AWS services, it’s essential to understand its limitations. Being aware of these restrictions can help you avoid unexpected charges and make the most effective use of the AWS Free Tier.

The primary limitations of the AWS Free Tier are as follows:

Usage Limits: AWS Free Tier provides limited free usage of AWS services. These limits vary from one service to another and are subject to change. Once you exceed these limits, standard service charges apply. For instance, if you exceed 750 hours of EC2 t2.micro instances or the 5GB of S3 storage, you’ll be billed for the additional usage.

Validity Period: Some services are free under the AWS Free Tier for 12 months following your AWS sign-up date. After this period, standard service charges apply. However, some services, like Amazon DynamoDB, offer free usage indefinitely.

Limited Services: Not all AWS services are included in the Free Tier. While many popular services are covered, there are still several services for which standard charges apply, even for minimal usage.

Regional Availability: Some AWS Free Tier services may not be available in all AWS Regions. It’s necessary to check whether the service you intend to use is available for free in your chosen region.

Given these limitations, it becomes crucial to monitor your AWS usage. Tools like AWS Budgets and AWS Cost Explorer can help you keep track of your AWS Free Tier usage. You can also set custom cost and usage alerts to notify when you exceed your budgeted amount.

Moreover, when deploying services using Terraform, ensure you use resources within the Free Tier. Always double-check your Terraform scripts to avoid deploying resources that could result in charges.

Similarly, when managing AWS services with Python and Boto3, it’s a good practice to implement checks in your scripts to ensure you don’t exceed Free Tier limits unintentionally.

Remember, understanding these limitations doesn’t detract from the benefits of the AWS Free Tier; instead, it helps you to leverage it more effectively and avoid any unwelcome surprises in the form of unexpected costs.

How to Access AWS Free Tier

Accessing the AWS Free Tier is straightforward, making it easy to experiment with and leverage AWS services. Here’s how you can get started:

Step 1: Create an AWS Free Tier Account: The first step is to create an AWS account if you haven’t done so already. Visit the AWS homepage and click on “Create an AWS Account.” You must provide basic information, including your email address and credit card details. Remember, while you must enter your credit card information to create an account, you won’t be charged unless your usage exceeds the Free Tier limits.

Step 2: Confirm Your Identity: After entering your details, you must verify your identity through phone calls or text messages.

Step 3: Choose a Plan: You’ll then be asked to choose a plan. You can select the basic plan, which gives you access to the AWS Free Tier.

Step 4: Sign in to the Console: Once your account is set up, you can sign in to the AWS Management Console to manage and monitor your AWS resources.

With your AWS account ready, you can use AWS services within the Free Tier limits. Whether deploying an EC2 instance using Terraform or scripting AWS services management using Python’s Boto3, remember to stay within the AWS Free Tier usage limits to avoid unexpected costs.

Moreover, AWS provides the Free Tier Widget in the AWS Management Console, helping you track your Free Tier usage. You can also use AWS Budgets and Cost Explorer to manage your AWS usage and costs.

In the next sections, we’ll discuss practical examples of using the AWS Free Tier with Terraform and Python. These hands-on examples will give you a solid foundation to build upon as you begin your journey into the exciting world of AWS and cloud computing.

A Practical Guide to AWS Free Tier with Terraform

Now that we understand the AWS Free Tier, its benefits, and its limitations, let’s see it in action. We’ll use Terraform, a widely used Infrastructure as Code (IaC) tool, to deploy resources within the AWS Free Tier.

Installing and Configuring Terraform

Before deploying AWS resources, we need to install and configure Terraform. Follow the steps below:

Step 1: Install Terraform: Download the appropriate package from the Terraform downloads page. Unzip the package and move the executable file to a location in your system’s PATH.

Step 2: Verify the Installation: You can verify the installation by opening a new terminal window and typing the following command: terraform. If your installation is successful, you should see a list of basic Terraform commands in response.

Step 3: Configure AWS Access: Terraform needs to authenticate with AWS to create resources. You can provide your AWS access keys (Access Key ID and Secret Access Key) through an AWS credentials file located at ~/.aws/credentials. This file should look like this:

aws_access_key_id = YOUR_ACCESS_KEY
aws_secret_access_key = YOUR_SECRET_KEY

Alternatively, you can install and configure aws-vault to manage your AWS credentials more securely.

We can start deploying AWS resources now that we have Terraform ready.

Deploying AWS Resources with Terraform

Let’s start by deploying a simple t2.micro EC2 instance, which falls within the AWS Free Tier. Here’s a basic Terraform configuration for this task:

provider "aws" {
  region = "us-west-2"
resource "aws_instance" "example" {
  ami           = "ami-0c55b159cbfafe1f0"
  instance_type = "t2.micro"
  tags = {
    Name = "example-instance"

In this configuration, we specify the provider as AWS and define a single resource of type aws_instance. The ami attribute specifies the Amazon Machine Image, and instance_type specifies the type of instance, in this case, t2.micro, which is included in the AWS Free Tier.

To deploy this configuration, you can run the following commands in your terminal:

terraform init    # to initialize your Terraform configuration
terraform plan    # to see what changes Terraform will make
terraform apply   # to apply the changes

Running terraform apply will prompt you to confirm the changes. Type yes to confirm and deploy the instance.

If you’re interested in EC2 instance deployment automation, check the Leveraging Ansible and Terraform for Efficient Infrastructure Automation article.

Always ensure your Terraform configurations are designed to deploy resources that fall within the AWS Free Tier to avoid unexpected charges.

With these steps, you’ve successfully deployed an AWS resource using Terraform, giving you a practical introduction to managing AWS resources within the Free Tier.

AWS Free Tier Management with Python Boto3

Python’s AWS SDK, Boto3, is another excellent tool for managing AWS resources. It allows you to write scripts that can create, update, and delete AWS resources, helping you to automate and streamline your AWS operations.

Check the Introduction to Boto3 library article for more information. Also, you may be interested in the Python Boto3 Course and other Python Boto3 Tutorials.

Setting Up Python and Boto3

Before writing scripts, we need to set up Python and install Boto3. Here are the steps:

Step 1: Install Python: If you haven’t already installed it, download it from the official Python website. Install the latest version following the provided instructions.

Step 2: Install Boto3: Once Python is installed, you can install Boto3 using pip, Python’s package manager. Open a terminal window and enter the following command: pip install boto3.

Step 3: Configure AWS Credentials: Like Terraform, Boto3 needs to authenticate with AWS to manage resources. You can provide your AWS access keys in the same way as mentioned above through the AWS credentials file located at ~/.aws/credentials.

With Python and Boto3 installed, we can start scripting AWS services.

Scripting AWS Services with Boto3

Let’s start with a simple script to create an S3 bucket, a service under the AWS Free Tier.

import boto3
def create_bucket(bucket_name, region):
    s3 = boto3.client('s3', region_name=region)
    response = s3.create_bucket(
        CreateBucketConfiguration={'LocationConstraint': region}
    return response
bucket_name = 'my-new-bucket'
region = 'us-west-2'
create_bucket(bucket_name, region)

In this script, we import the boto3 module and define a function create_bucket that creates an S3 bucket. The create_bucket function takes the bucket name and the AWS region as arguments. We use the boto3.client function to create an S3 client, which we then use to create a bucket.

You can run this script in a Python environment, and it will create an S3 bucket within your AWS account. Remember, the AWS Free Tier includes 5GB of S3 storage, so try not to exceed this limit to avoid charges.

As with Terraform, it’s crucial when using Boto3 always to ensure that your scripts are designed to manage resources that fall within the AWS Free Tier. This practice will help you avoid unexpected charges and get the most from the AWS Free Tier.

You’ve seen how to use Python and Boto3 to manage AWS Free Tier resources. This hands-on approach can help you better understand AWS services and how to automate and optimize your cloud operations.

AWS Free Tier for Web Hosting

AWS Free Tier is a great way to host a small website for free. The Free Tier includes services perfect for web hosting, such as EC2 for running your web server and S3 for storing static files. The t2.micro instance offered by EC2 under the Free Tier can effectively serve a small to medium-traffic website. S3 can store and retrieve website files like HTML, CSS, and JavaScript. Remember to monitor your usage to ensure it doesn’t exceed the Free Tier limits.

AWS Free Tier EC2 Usage

Under the Free Tier, AWS offers 750 hours each month of EC2 running a Linux t2.micro or t3.micro instance and a Windows t2.micro or t3.micro instance for one year. This is sufficient to run one instance continuously every month.

EC2 instances can be used for various applications, such as running web and application servers, data analysis, and batch processing. With Terraform, you can script the creation, modification, and destruction of your EC2 instances to keep within the Free Tier limits.

AWS Free Tier S3 Usage

AWS Free Tier includes 5GB of standard storage in S3, 20000 GET requests, and 2000 PUT, COPY, POST, or LIST requests each month for one year. S3 is perfect for storing and retrieving any amount of data, at any time, from anywhere on the web.

Whether hosting a website, backing up your data, or storing application assets, you can use tools like Boto3 for scripting your S3 operations and keeping track of your usage to stay within the Free Tier limits.

Tips to Avoid Unexpected Charges

While the AWS Free Tier provides an excellent platform to learn, experiment, and even host small-scale applications, it’s important to be aware of potential pitfalls that can lead to unexpected charges. Here are some tips to avoid these situations:

Understand Free Tier Limits: Every AWS service included in the Free Tier has its own set of usage limits. These limits can be based on time, capacity, requests, etc. It’s crucial to understand these limits and monitor your usage accordingly.

Use AWS Budgets: AWS Budgets allows you to set custom cost and usage budgets that alert you when your usage exceeds your budgeted amount. This tool can be an effective way to manage your AWS costs.

Track Your Usage with the Free Tier Widget: AWS provides a Free Tier Usage widget in the AWS Management Console. This widget shows your usage for each service and how close you are to exceeding the Free Tier limits.

Clean Up Unused Resources: Ensure you delete or stop any AWS resources you are not using. For example, if you’re no longer using an EC2 instance you deployed with Terraform, destroy it using the terraform destroy command. Similarly, if you’ve created resources using Boto3 scripts, ensure you have corresponding cleanup scripts to remove resources when they’re no longer needed.

Take Advantage of AWS Cost Explorer: AWS Cost Explorer allows you to view and analyze your costs and usage over time. This tool can identify which services cost you the most and adjust your usage accordingly.

Use Resource Tagging: Tagging your AWS resources can help you track your usage and costs more effectively. You can associate costs with specific projects or departments, making managing your resources easier and staying within the Free Tier limits.

In conclusion, while the AWS Free Tier offers many benefits, it’s crucial to manage it effectively to avoid unexpected charges. By understanding the Free Tier limits, monitoring your usage, and cleaning up unused resources, you can enjoy the advantages of the AWS Free Tier without any unwelcome surprises.

Case Study: Successful AWS Free Tier Implementation

To provide a real-world example of how the AWS Free Tier can be utilized effectively, let’s explore a case study of a small tech startup, Hands-On.Cloud LLC. Hands-On.Cloud LLC was able to leverage the AWS Free Tier for its initial development and testing phase, saving significant costs in its early stage.

Background: Hands-On.Cloud LLC is a small startup developing an AI-based chatbot service. When they started, they had limited capital and were looking for ways to minimize their initial infrastructure costs.

The Challenge: Hands-On.Cloud LLC needed a robust, scalable infrastructure to build and test its chatbot application. They needed AWS services like Amazon EC2 for their application servers, Amazon S3 for storing chat logs, and Amazon DynamoDB for maintaining user profiles. However, they were cautious about their budget and wanted to keep costs as low as possible.

The Solution: Hands-On.Cloud LLC decided to utilize the AWS Free Tier. They used Terraform to set up their infrastructure, which included t2.micro EC2 instances, S3 buckets, and DynamoDB tables fell under the Free Tier.

For instance, their Terraform script to deploy EC2 instances looked something like this:

provider "aws" {
  region = "us-west-2"
resource "aws_instance" "chatbot_server" {
  ami           = "ami-0c55b159cbfafe1f0"
  instance_type = "t2.micro"
  tags = {
    Name = "chatbot-server-instance"

To manage their S3 buckets for storing chat logs, they wrote Python scripts using Boto3. This allowed them to automate adding, retrieving, and deleting chat logs as needed.

import boto3
def create_chatlog_bucket(bucket_name, region):
    s3 = boto3.client('s3', region_name=region)
    response = s3.create_bucket(
        CreateBucketConfiguration={'LocationConstraint': region}
    return response
bucket_name = 'chatbot-logs'
region = 'us-west-2'
create_chatlog_bucket(bucket_name, region)

For more information on working with S3 using the Boto3 library, check the Terraform S3 Tutorial – Easy AWS automation article.

The Result: By effectively leveraging the AWS Free Tier, Hands-On.Cloud LLC was able to deploy its initial infrastructure without incurring any costs. They kept track of their usage and ensured not to exceed the Free Tier limits to avoid surprise charges.

This strategy allowed Hands-On.Cloud LLC to focus its resources on product development while gaining valuable experience with AWS services. As their application grew and their requirements exceeded the Free Tier limits, they were confident in scaling their AWS resources, having thoroughly tested their infrastructure within the Free Tier.

Conclusion: This case study illustrates how startups and small projects can successfully use the AWS Free Tier to cut costs and gain experience with AWS services. The key is understanding the Free Tier’s limits, monitoring usage, and using tools like Terraform and Boto3 to manage resources effectively.


The AWS Free Tier is a fantastic offering for anyone looking to learn, experiment with, or even host small-scale applications on AWS. It gives you access to a wide range of AWS services without any upfront costs, making it an invaluable resource for students, hobbyists, startups, and businesses testing the AWS waters.

This guide provided an in-depth exploration of the AWS Free Tier, discussing its benefits, limitations, and components. We also walked through how to access the AWS Free Tier and manage resources using two popular tools – Terraform for Infrastructure as Code and Python’s Boto3 for scripting AWS services.

We illustrated how you could effectively utilize the AWS Free Tier through a practical guide and a real-world case study. We highlighted the importance of understanding the Free Tier’s limitations and provided tips for avoiding unexpected charges.

Whether you are a beginner starting your AWS journey, a developer interested in exploring new AWS services, or a startup trying to minimize initial costs, the AWS Free Tier can be a game-changer. Taking a strategic approach and using the right tools can unlock a world of opportunities with the AWS Free Tier.

As you proceed with your AWS journey, remember that the key to success lies in learning, experimenting, and continuously monitoring your usage. With the AWS Free Tier, Terraform, and Boto3 at your disposal, you are well-equipped to make the most of AWS’s immense capabilities. Happy exploring!


To learn more about the topics covered in this article, check out the following resources:

  1. Mastering AWS Cost Optimization: Real-world technical and operational cost-saving best practices book
  2. AWS Free Tier: Learn more about AWS Free Tier, its components, and its limitations on the AWS Free Tier page.
  3. Terraform: The official Terraform documentation is a great resource for understanding how to use Terraform to manage your AWS resources.
  4. Python Boto3: For in-depth information about using Boto3 for AWS resource management, check out the Boto3 documentation.
  5. AWS Budgets: AWS Budgets is a useful tool for monitoring your AWS usage and costs. Learn more on the AWS Budgets page.
  6. AWS Cost Explorer: This tool lets you view and analyze your costs and usage over time. Find out more on the AWS Cost Explorer page.
  7. AWS Free Tier Usage Widget: Check out the AWS documentation to learn how to track your Free Tier usage with this handy widget.

By referring to these resources, you can deepen your understanding of the AWS Free Tier, Terraform, and Boto3 and enhance your skills in managing AWS resources. Continued learning and experimentation is the key to making the most of these tools.

Andrei Maksimov

I’m a passionate Cloud Infrastructure Architect with more than 20 years of experience in IT. In addition to the tech, I'm covering Personal Finance topics at https://amaksimov.com.

Any of my posts represent my personal experience and opinion about the topic.

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