Plan expenses using budgets. Set spending alert thresholds and track budget execution in real time. The system automatically sends alert notifications when actual or predicted spending exceeds the thresholds, which helps you keep your spending under control.
What is Budget Management
Budget Management is a cost optimization tool from Alibaba Cloud that lets you set budgets for organizations, departments, projects, or specific Alibaba Cloud services. This helps you efficiently monitor cloud spending and avoid unexpected costs.
You can track actual spending against your budget plan. After you configure the budget amount and alert rules, the system proactively sends alert notifications by email, , and internal message when an alert threshold is triggered. This helps you monitor the budget execution status at any time.
You can use estimate-to-actual analysis to analyze the change trends between predicted and actual spending. This lets you make dynamic adjustments.
Budget Management supports two budget types:
Cost Budget: Focuses on the costs that are generated by resources. You can set a monetary budget with annual, quarterly, or monthly cycles and corresponding alert thresholds based on dimensions such as account and product. The system sends alert notifications when actual or predicted spending reaches the alert threshold.
Utilization and Coverage Budget: Monitors the utilization and coverage of Savings Plans and reserved instances. You can set utilization and coverage budgets with annual, quarterly, or monthly cycles and corresponding alert thresholds based on dimensions such as account, region, and instance. The system sends alert notifications when utilization or coverage reaches the alert threshold.
When an alert threshold is triggered, the system sends a message notification. However, this does not restrict actual resource usage. You need to handle this as needed.
Create a Budget
You can activate the Budget Management feature before first use. Log on to the Expenses and Costs console. In the left navigation pane, locate Budget Management. Click Activate for Free. After activation, wait 24 hours. The feature becomes available only after your account has spending data.
To create a budget, select the budget type, set the budget name, select the budget scope, set the budget cycle and threshold rules, and configure alerts. Finally, click Complete to save the budget.
Create a Cost Budget
Log on to the Expenses and Costs console. On the Budget Management page, click Create Budget.
Select a budget type: On the Create Budget page, select Cost budget. Then, click Next.
Set Budget: Fill in the budget's Basic Information and Budget Plan as prompted.
Enter the budget’s Basic Information.
Basic Information
Description
Budget Name
Define a suitable name based on the budget's purpose and scenario.
Enterprise/Organization/Account
For MA accounts with enterprise finance or multiple enterprise accounts enabled, create budgets for MA accounts or member accounts.
For member accounts under enterprise financial management, create budgets only for the current account.
Budget Scope
Set the specific budget scope based on dimensions such as cost center, owner, region, product, product details, and consumption type.
For a single budget, click Add to create multiple scopes.
Cycle
This is the period for budget amount aggregation. Set it to annual, quarterly, or monthly.
Start and End Dates
Select the effective start and end dates for the budget based on the configured rolling period. The date range should not exceed 24 rolling periods.
Remarks
Add relevant information for the budget.
After you specify the basic information, a chart that shows historical spending and future spending predictions is displayed on the right.
Fill in the Budget Plan.
Budget Plan
Description
Budget Plan Type
Select based on the configured rolling period and start/end range:
Static field: Within the start and end dates, enter a Fixed Amount. The budget amount for each rolling period will be the same. The spending amount corresponds to the "Amount Payable" in the bill.
Different values: Within the start and end dates, customize the budget amount for each rolling period. Different rolling periods support different setting times:
For a monthly rolling period, set budget amounts for up to 12 rolling periods.
For a quarterly rolling period, set budget amounts for up to 4 rolling periods.
For an annual rolling period, set budget amounts for up to 3 rolling periods.
Total Budget
No need to fill in. The system automatically aggregates the total budget for each rolling period based on the start and end dates, rolling period, and budget plan type.
After you confirm the budget information, click Next.
Set Alert: Configure alert rules and message delivery methods for this budget. Click +Add Alerts to specify alert settings. You can configure up to five alert groups for each budget.
Alert Content
Description
Alert Object
Actual cost (this period): Send alert notifications by comparing the actual spending amount of the current rolling period with the current budget amount.
Predicted Value of Current Cycle: Send alert notifications by comparing the predicted spending amount of the current rolling period with the current budget amount.
Accumulative Predicted Value: Send alert notifications by comparing the predicted amount from the budget start date to the current date with the total budget.
Accumulated actual: Send alert notifications by comparing the actual spending amount from the budget start date to the current date with the total budget.
Threshold Type
Fixed Value: A static amount. An alert is triggered when this amount is exceeded.
Percentage: Calculated as a percentage of the budget amount.
Threshold
An alert is triggered when the actual value exceeds the maximum threshold.
Alert Remarks
Add supplementary information for the alert.
Message Settings
To configure how you receive alerts, go to Message Center to set message recipients. Ensure that the recipients you select have a verified mailbox so that they can receive notifications.
Confirm Budget Information: Review the budget details, budget amount, and alert settings. Click Submit to create the budget and its associated alerts.
After you create a cost budget, you can view the actual and predicted values after T+2 days.
Cost budget alert notifications are sent once on day T+1 after the alert threshold is exceeded.
If the effective period of a configured budget has not started, no alert notifications are sent. New alerts take effect after 12:00 (UTC+8) on day T+1. For example, if you configure an alert at 09:00 (UTC+8) on the 5th of a month, the alert takes effect after 12:00 on the 6th.
Create a Utilization and Coverage Budget
Log on to the Expenses and Costs console. On the Budget Management page, click Create Budget.
Select a budget type: On the Create Budget page, select Usage or coverage budget and click Next.
Set Budget: Complete the Basic Information and Budget Plan as prompted.
Enter the budget’s Basic Information.
Basic Information
Description
Budget Name
Define a suitable name based on the budget's purpose and scenario.
Enterprise/Organization/Account
For MA accounts with enterprise finance or multiple enterprise accounts enabled, create budgets for MA accounts or member accounts.
For member accounts under enterprise financial management, create budgets only for the current account.
Deduct Resources
Supports Savings Plans, reserved instances, and Storage Capacity Units (SCU).
Usage or coverage budget
Usage (%): Utilization reflects resource usage. Higher utilization means more efficient resource or instance usage.
Coverage: Coverage reflects the deduction ratio for pay-as-you-go resources. Higher coverage means more effective cost reduction.
Budget Scope
Savings Plans: Set the budget scope based on dimensions such as resource type and instance ID.
For a single budget, click Add to create multiple scopes.
Cycle
This is the period for budget amount aggregation. Set it to annual, quarterly, or monthly.
Start and End Dates
Select the effective start and end dates for the budget based on the configured rolling period. The date range should not exceed 24 rolling periods.
Remarks
Add relevant information for the budget.
After you specify the basic information, a chart that shows historical utilization is displayed on the right.
You can fill in the Budget Plan.
Budget Plan
Description
Budget Plan Type
Select based on the configured rolling period and start/end range:
Static field: Within the start and end dates, enter a Budget in Percentage. The budget will be the same for each rolling period.
Different values: Within the start and end dates, customize the budget percentage for each rolling period. Different rolling periods support different setting times:
For a monthly rolling period, set budget percentages for up to 12 rolling periods.
For a quarterly rolling period, set budget percentages for up to 4 rolling periods.
For an annual rolling period, set budget percentages for up to 3 rolling periods.
Total Budget
No need to fill in. The system automatically aggregates the total budget for each rolling period based on the start and end dates, rolling period, and budget plan type.
After you confirm the budget information, click Next.
Set Alert: Configure alert rules and notification methods for this budget. Click +Add Alerts to configure the new alert group. You can add up to 5 alert groups for each budget.
Alert Content
Description
Threshold
An alert is triggered when utilization or coverage falls below this threshold.
Alert Remarks
Add supplementary information for the alert.
Message Settings
Set how to receive alerts. Go to Message Hub to set message recipients.
Confirm Budget Information: After you confirm the budget creation information, click Submit. This action generates the budget and its corresponding alerts.
After you create a utilization and coverage budget, you can view the actual values after T+1 day.
View Budgets
View Budget Information
Log on to the Expenses and Costs console. On the budget management page, you can view the budgets you created, including Type, Budget Name, Total Budget, Actual Total Amount, Status, and other details.
Type: Cost budget or Usage or coverage budget.
Total Budget: The total cost, usage, or coverage from the budget’s start date to its end date.
Actual Total Amount: The cumulative cost, usage, or coverage from the budget's start date to the current date.
Estimated Total Amount: The projected consumption, usage, or coverage from the budget start date to the current date.
Actual Total Amount/Total Budget: The progress of actual spending against the budget.
Budget Scope: Click the View button to view details of the associated scope, such as accounts, products, and regions.
For each budget, you can perform operations such as Edit, Copy, and Delete, or download and export the budget list.
View Forecast vs. Actual Analysis
Select a budget. Click Estimate-to-Actual Analysis in the operation column on the right to compare the budget with actual consumption.
Forecasted values are predicted based on historical consumption data and may differ from actual costs during the forecast period. Forecast data is for reference only.
Forecast vs. Actual Trend: Shows the monthly growth trend of actual and forecasted consumption.
Current Period Forecast vs. Actual: Shows the proportion of the current period's actual and forecasted totals relative to the current period's total budget. Forecasting is not supported for usage and coverage budgets.
Budget Records: Shows actual values, budgeted values, and their differences for each rolling period within the budget's start and end dates.
Occurrence Details:
For a single rolling period of a cost budget, click Actual Expenses to go to . You can then view consumption details for the corresponding date.
To view the usage and coverage budget for a savings plan within a single rolling period, click Actual Expenses to go to the page. On this page, you can view resource consumption details for the corresponding date.
Alert Settings: Click Set Alert in the upper-right corner to configure alerts for the budget.
Legacy Console Instructions
Log on to the Expenses and Costs console. In the navigation pane on the left, click . For more information about the overall flow, see the instructions above.
How to Create an Effective Budget
An effective budget provides a clear financial roadmap. It optimizes costs without sacrificing business growth.
Step 1: Analyze historical spending data and establish cost baselines
Review your cloud spending bills from the past 3 to 6 months to identify fixed monthly expenses and variable costs:
Stable Costs: Identify relatively fixed monthly overhead, such as long-running servers, reserved instances (RIs), and database services. These costs form your cost baseline.
Variable Costs: Observe periodic fluctuations, such as changes in consumption between peak and off-peak hours. This helps you accurately predict future trends. You must also identify abnormal peaks, such as cost surges that are caused by unexpected events, data migration, or Performance Testing. Exclude these one-time costs from the baseline.
Step 2: Refine cost estimates based on business growth
Communicate with the relevant business and research and development (R&D) teams to understand recent business changes:
New projects or features: Determine whether new applications will be deployed and which new Alibaba Cloud services, such as artificial intelligence/machine learning (AI/ML) services, are expected to be introduced. Then, estimate the initial costs.
User or traffic growth: This requires you to reserve compute and bandwidth resources for higher traffic.
Architecture changes: Determine whether there are plans for service migration, technology stack upgrades, or architecture refactoring.
Data volume growth: Determine whether the monthly data storage demand is steadily increasing. This affects the expected costs for data storage and backup.
Step 3: Refine the budget scope for accurate cost allocation
Break down the overall budget into smaller sub-budgets with clearly assigned teams. Consider the following dimensions for chunking:
By project or product line: Set a budget for each independent product or project.
By team or department: Allocate budgets for development teams, QA testing teams, and marketing departments.
By environment: Set separate budgets for production, staging, and development environments. This helps prevent resource misuse in staging environments.
By cost center: For large enterprises, you can divide budgets based on internal financial cost centers.
The chunk dimensions must align with the budget management scope. This requires you to associate mappings when you plan the account system and design the cost center structure.
Step 4: Set amounts and reserve a buffer
Cloud environments are flexible and can be uncertain. We recommend that you add a 10% to 20% buffer based on historical average spending and estimated incremental costs. This buffer can handle sudden performance issues, urgent scale-out demands, or unexpected usage growth.
The final formula is:Budget Amount = (Historical Spending Baseline + Future Incremental Costs) × (1 + Buffer Ratio)
Step 5: Configure alerting and tiered feedback mechanisms
Use alerting rules to stay informed about budget progress in advance. This allows for timely control:
Set multi-level threshold alerts:
50% (Notification/For Your Information (FYI)): Send a reminder email to the project owner to inform them that half of the budget is spent and the current status is Normal.
80% (Warning): Send a warning message to the team to remind them to monitor spending growth and check for abnormal activity.
100% (Critical): Send the highest-level alert to the owner and the finance department. This indicates that the budget is exhausted and requires immediate review.
Use predicted spending alerts. When the predicted spending reaches 100% of the budget, you have ample time to adjust the actual consumption.
Step 6: Perform regular reviews and iterations
Hold cost review meetings on a monthly or quarterly basis. Analyze the drift between actual and planned spending and identify its causes. Determine whether any cost items were overlooked and assess whether current business development goals are being met. Dynamically adjust the next budget based on the review results to continuously iterate and optimize.