NAT Gateways are one of the classic AWS gotchas.

They can really run up your bill quickly without you noticing it until the next few invoices because they hide under “EC2-Other”. What's "funny" is that you can set up your own NAT Gateway on AWS for way cheaper, but I suppose that's a burden many would rather just pay away.

In this post, we’ll first identify what a NAT Gateway is, how pricing works, and how you can make sure you are saving as much money on NAT Gateway.

A NAT Gateway (Network Address Translation Gateway) is an AWS-managed service that lets instances in private VPC subnets access the internet securely while blocking inbound connections. It’s a security must-have for private subnets, ensuring instances can fetch updates or connect to external services without exposing themselves to the internet.

There are two types:

• public NAT Gateways (for internet access)

• private ones (for VPC-to-VPC or on-premises connections)

  We’ll focus on public NAT Gateways here due to their cost impact.

NAT Gateways sit in a public subnet, linked to an Elastic IP. When a private instance sends traffic to the internet, the NAT Gateway forwards it, replacing the instance’s private IP with its own public IP. Responses come back through the gateway, keeping the instance shielded. This setup is seamless but can get pricey—fast.

NAT Gateway Pricing: Why Your AWS Bill Is So High

NAT Gateway costs can sneak up on you. Here’s the breakdown based on AWS pricing in us-east-1:

• Hourly Fee: $0.045 per gateway, totaling $32.40/month (720 hours).

• Data Processing Fee: $0.045 per GB processed, regardless of direction.

• Data Transfer Fee: Standard AWS rates, like $0.09/GB for outbound internet traffic.

Example Calculation for 100 GB/month:

• Hourly: $32.40

• Data processing: 100 GB × $0.045 = $4.50

• Data transfer: 100 GB × $0.09 = $9.00

• Total: $45.90/month

For 1 TB (1024 GB)/month, the cost jumps to $170.64—$32.40 (hourly) + $46.08 (processing) + $92.16 (transfer). These charges often hide under "EC2-Other" in your AWS bill, making them easy to overlook until the invoice hits.

Why NAT Gateways Cost More Than You Think

The real sting comes from the data processing fee, which applies to every GB, even if traffic stays within AWS regions. Combine that with data transfer fees, and costs can spiral for high-traffic applications. Many users don’t notice until their bill arrives, as NAT Gateway expenses aren’t always clearly labeled in cost breakdowns.

5 Proven Ways to Save Money on NAT Gateways

You don’t have to let NAT Gateways drain your budget. Here are five strategies to cut costs you can get started tonight:

1. Use VPC Endpoints for AWS Services

VPC endpoints let your VPC resources access AWS services like S3 or CloudWatch privately, bypassing NAT Gateways and slashing costs. Gateway endpoints for S3 and DynamoDB are free—no hourly or data processing fees, and intra-region transfers cost $0. Interface endpoints (e.g., for CloudWatch) cost $0.01/hour per AZ and $0.01/GB processed, still far cheaper than NAT Gateways for high data volumes. For example, routing 1 TB to CloudWatch via an Interface endpoint costs $17.44/month ($7.20 hourly + $10.24 processing), saving $153.20 compared to $170.64 through a NAT Gateway.

For S3-heavy workloads, the savings are even bigger. Transferring 5 TB/month to S3 via a NAT Gateway costs $852.90 ($32.40 hourly + $230.40 processing + $590.40 transfer), but a Gateway endpoint drops this to $0, saving the full amount. For mixed workloads—like 500 GB to S3 and 500 GB to Kinesis—a Gateway endpoint for S3 ($0) and an Interface endpoint for Kinesis ($12.72) total $12.72, saving $157.92 over a NAT Gateway’s $170.64. Companies I’ve worked with have saved thousands monthly, like one that cut $5,000 by routing 30 TB of S3 and CloudWatch traffic through endpoints.

For Gateway endpoints, go to the VPC Dashboard, create a Gateway endpoint for S3 or DynamoDB, select your VPC and route tables, and update routes to use the endpoint—it’s free and instant. For Interface endpoints, create one for your service (e.g., CloudWatch), select subnets and security groups, and enable DNS resolution in your VPC to use the private DNS name; costs are $0.01/hour per AZ and $0.01/GB. Use VPC Flow Logs to audit traffic and identify services like S3 or Kinesis for endpoints, maximizing savings.

Choose Gateway endpoints for S3/DynamoDB and Interface endpoints for high data to services like CloudWatch or Kinesis—stick with NAT Gateways for general internet access. Deploy Interface endpoints in multiple AZs for availability ($7.20/month per AZ), configure security groups for access, and monitor costs in AWS Cost Explorer. If accessing cross-region services, note data transfer fees ($0.02/GB), but you’ll still avoid NAT Gateway processing fees, making this a must-use strategy for cost optimization.

2. Switch to a NAT Instance for High Data Transfer

A NAT instance, like a t3.micro EC2 instance at $0.0104/hour ($7.49/month for 720 hours), is a cost-effective alternative to a NAT Gateway for high data transfer, as it skips the $0.045/GB data processing fee. For 1 TB/month, a NAT instance costs $99.65 ($7.49 instance + $92.16 transfer at $0.09/GB), saving $71/month compared to a NAT Gateway’s $170.64 ($32.40 hourly + $46.08 processing + $92.16 transfer). For even higher usage, like 5 TB/month, the savings grow to $355—$467.45 (NAT instance) vs. $852.90 (NAT Gateway), making this ideal for data-heavy workloads.

The catch is you’ll manage the NAT instance yourself, including setup, monitoring, and ensuring availability. Use an EC2 instance with a NAT AMI (e.g., Amazon’s NAT instance AMI), enable IP forwarding, configure route tables to direct private subnet traffic to the instance, and set up an Elastic IP for internet access. For high availability, deploy across multiple AZs with an Auto Scaling group, but this adds complexity and cost—still, the savings often outweigh the effort for high-traffic applications.

3. Optimize Data Traffic

Reducing the data flowing through your NAT Gateway directly lowers the $0.045/GB processing fee and data transfer charges (e.g., $0.09/GB outbound), potentially saving you 50% or more on your bill. Here’s how to do it:

• Cache Frequently Accessed Data: Use Amazon ElastiCache to store repetitive requests locally, reducing outbound traffic—caching 20% of 1 TB can save $27.60/month.

• Compress Files Before Transfer: Apply GZIP compression to shrink large files like logs or backups; compressing 1 TB by 50% cuts costs from $138.24 to $69.12.

• Use a CDN Like CloudFront for Static Content: Offload images, videos, and other static assets to CloudFront, which delivers from edge locations at a lower cost than NAT Gateway transfers. These steps can slash your bill significantly while boosting performance.

Start by using VPC Flow Logs to analyze your NAT Gateway traffic and identify high-volume data types, then apply these strategies—set up ElastiCache for dynamic data, enable GZIP compression in your application or pipeline, and create a CloudFront distribution via the AWS Console to serve static assets from an S3 bucket or origin server. Not only will you save on processing and transfer fees (e.g., reducing 1 TB to 400 GB can drop costs from $138.24 to $55.30), but you’ll also improve user experience with faster load times, making this a cost-effective and performance-enhancing move.

4. Consolidate NAT Gateways

If high availability isn’t a priority for your application, consolidate to a single NAT Gateway across multiple Availability Zones (AZs) to reduce costs—dropping the hourly fee from $64.80/month for two gateways to $32.40 for one, saving you $32.40 monthly. Be aware of the risk: if the gateway or its AZ fails, your private subnet instances may lose internet access, so assess your app’s uptime needs before making this change.

To consolidate, update your VPC route tables to direct all private subnet traffic to one NAT Gateway, ensuring it’s in a public subnet with an Elastic IP; test connectivity to confirm no disruptions. Mitigate risks by monitoring the gateway’s health with CloudWatch metrics and setting up alerts for AZ failures—while this approach saves money, it’s best for non-critical workloads where brief outages are tolerable.

5. Monitor Costs with AWS Tools

Use AWS Cost Explorer to track NAT Gateway spending under "EC2-Other." Set budget alerts to catch spikes early on these services, and review route tables to ensure only necessary traffic flows through the gateway.

NAT Gateway vs. NAT Instance: Which Is Right for You?

Here’s a quick comparison to help you decide:

For low data (1 GB/month), a NAT Gateway costs $32.54 vs. $7.58 for a NAT instance. The savings grow with data volume, making NAT instances a better choice for high-traffic setups.

Best Practices for Management

To manage NAT Gateways effectively:

• Use AWS Cost Explorer to monitor spending, identifying NAT Gateway costs within "EC2-Other."

• Set budget alerts for cost thresholds, ensuring timely action.

• Ensure route tables route only necessary traffic through NAT Gateways.

• For high availability, deploy in multiple AZs, balancing cost and uptime needs.

In conclusion, NAT Gateways are essential but costly if unmanaged, often appearing under "EC2-Other" in bills. By leveraging VPC endpoints, considering NAT instances for high data transfer, optimizing traffic, and monitoring usage, users can significantly reduce costs. The choice between NAT Gateway and instance depends on workload, with endpoints offering unexpected savings for AWS service access, particularly for S3 and DynamoDB.

Yaddle out.