Creating your first budget

Overview

This tutorial walks you through creating your first budget in Cost Analyzer. Cost Analyzer provides two complementary budget tools: Group budget sets a spending threshold on a cost management group and alerts you when costs approach or exceed it; Budget planner overlays projected spend on the cost trend chart using planned cost targets or growth percentages, with ML-powered forecasting.

Start with Group budget to establish a live spending limit with alerts. Use Budget planner when you need to model projected costs or compare actual spend against a forecast.

Business value

Group budget catches cost overruns before the billing cycle closes. Budget planner surfaces spending trajectories before they materialise as overruns — giving your team time to act rather than just react.

Prerequisites

• Cost Analyzer is connected to at least one Azure subscription with imported cost data. See Initial setup if you have not completed this step.
• At least one cost management group exists. See Managing cost groups if you need to create one first.
• An escalation policy is configured to receive budget alerts. See Managing escalation policies in Cost Analyzer for reference.

Required permissions

Group budget uses the Monitoring feature permission:

Budget planner uses a separate permission. The Budget planner toggle must also be enabled for the cost group role by an administrator before access is granted:

How it works

Group budget sets a fixed spending threshold on a cost management group. Cost Analyzer evaluates actual or amortized costs against the budget on each import cycle and fires alerts when percentage thresholds are crossed. For monthly budgets, risk prediction can project the day the budget will be hit at the current spending rate before the month ends. Alerts route through escalation policies to your configured notification channels.

Budget planner overlays a projected cost line on the cost trend chart, based on either a planned cost amount or a growth percentage you define per month. ML-powered forecasting adds an upper and lower bound for current and future months, helping you gauge budget risk before it materialises.

Steps

Set up a group budget

Setting up a group budget establishes a live spending limit and activates the alerting pipeline for your cost management group.

Navigate to Cost Analyzer and open the cost management group you want to budget.

1. Go to Monitoring within the cost management group and click Configure in the Group budget widget.
2. Enable the monitoring toggle, select the Interval (Daily, Monthly, or Last 7 days), choose the Cost metric (Actual or Amortized), and enter the Budget value.
3. Click Next.
4. Set the Escalation policy and configure notification channels.
5. Click Save.

Optionally, add percentage threshold alerts to receive early warnings before the full budget is reached:

1. Open Alert Configuration in the group budget settings.
2. Under Alert conditions, enter one or more percentage thresholds (for example, 50 and 80).
3. Click Apply, then click Next → Save.

For monthly budgets, you can also enable budget risk prediction to project the estimated day the budget will be hit at the current spending rate:

1. Ensure the interval is set to Monthly.
2. Open Alert Configuration under the group budget settings.
3. Set the number of days used to calculate the prediction from the current spending rate.
4. Click Apply, then click Next → Save.

Configure Budget planner

Budget planner overlays a projected spend line on the cost trend chart, enabling you to compare planned against actual costs before a budget overrun occurs.

Navigate to Cost Analyzer and open the cost management group you want to plan.

1. Click the Context menu ( ⋮ ) next to the cost management group in the tree view.
2. Select Tools > Budget planner.
3. Click Configure to open the configuration panel.
4. Click + Add config, choose the target month, and enter either a planned cost amount or a growth percentage relative to the previous month.
5. Optionally, add a note for context or justification.
6. Click Apply to save the configuration and overlay the projected cost line on the chart.

To set up Budget planner alerts:

1. Click Configure on the Budget planner chart.
2. In the Notification settings section, enter a recipient email address and select an email template.
3. Select one or more notification channels (Teams, Slack, PagerDuty, webhook, and others).
4. Click Save.

Example scenario

Contoso's FinOps team manages the Contoso Production cost management group. They configure a Monthly group budget of $10,000 using amortized cost, with percentage thresholds at 50% and 80% and a 14-day risk prediction window — so they receive early warnings well before month-end. They also open Budget planner and configure a 10% growth target for the next three months to model their planned service expansion. When actual spend tracks above both the threshold alert and the Budget planner projection in week two, the team investigates a spike in Data Factory pipeline runs and corrects the misconfigured retry loop before the billing cycle closes over budget.

Troubleshooting

1. Group budget alerts are not firing when spend exceeds the threshold
   Cause: The monitoring toggle may be disabled, or the escalation policy has an invalid notification channel.
   Fix: Open the group budget widget, confirm the monitoring toggle is enabled, and verify the escalation policy settings. Send a test notification to confirm delivery.

2. Risk prediction stopped alerting mid-month
   Cause: Actual spend has exceeded the budget for the current month. Risk prediction alerts are suppressed once the budget is breached — the standard budget alert applies from that point.
   Fix: No action required. Risk prediction resumes at the start of the next month.

3. Budget planner option is not visible in the Tools menu
   Cause: The Budget planner toggle has not been enabled for the cost group role.
   Fix: Ask your administrator to enable the Budget planner toggle in role management for the cost group.

4. Budget planner configuration is not reflected in the chart
   Cause: The configuration may not have been saved, or the selected month does not match the chart's active time range.
   Fix: Confirm the configuration was saved and that the chart time range includes the configured month.

5. Group budget changes do not persist after clicking Apply
   Cause: Apply only stages the change in the alert configuration panel.
   Fix: Click Next → Save to persist all threshold and risk prediction settings.

Related articles

• Group budget monitoring
• Budget planner
• Cost monitors
• Managing escalation policies in Cost Analyzer
• Setting up anomaly detection