How to Self-Host n8n on a VPS

n8n's cloud pricing charges per workflow execution. For GTM systems that run thousands of operations daily, this adds up fast. Self-hosting eliminates per-execution costs entirely — you pay a fixed VPS fee regardless of volume.

We self-host n8n for every GTMinds client. This guide covers the exact setup we use in production, from VPS selection to automated backups.

Why Self-Host n8n?

• Unlimited executions — no per-workflow or per-operation fees. Run 100 or 100,000 executions/day at the same cost.

• Data stays on your infrastructure — prospect data never leaves your server. Critical for GDPR compliance and clients in regulated industries.

• Full control — install community nodes, configure memory limits, set custom environment variables, and access logs directly.

• Cost predictability — fixed monthly VPS cost ($20–40) vs. variable cloud pricing that scales with usage.

Step 1: Choose and Provision a VPS

For n8n, you need a VPS with at least 4 GB RAM and 2 vCPUs. Our recommended setup:

• Hostinger KVM 4 — 4 GB RAM, 4 vCPUs, 200 GB SSD. ~$600/year (roughly $50/month, often discounted to $20–30 with annual billing). This is what we use for most client deployments.

• DigitalOcean — 4 GB RAM droplet at $24/month. Good alternative with simpler UX.

• Hetzner — cheapest option (EU-based). 4 GB RAM at ~$7/month. Best value if you want European data residency.

Select Ubuntu 22.04 or 24.04 as your operating system. Once provisioned, SSH into your server.

Step 2: Install Docker

n8n runs as a Docker container, which makes installation and updates straightforward. Install Docker and Docker Compose on your VPS:

1. Update your system packages: sudo apt update && sudo apt upgrade -y

2. Install Docker using the official install script: curl -fsSL https://get.docker.com | sh

3. Add your user to the Docker group: sudo usermod -aG docker $USER

4. Install Docker Compose: sudo apt install docker-compose-plugin -y

5. Verify both are installed: docker --version && docker compose version

Step 3: Create the Docker Compose File

Create a directory for n8n and add a docker-compose.yml file. The compose file defines n8n, a PostgreSQL database for workflow storage, and Caddy as a reverse proxy for SSL.

Key configuration in your compose file:

• n8n container — using the latest n8n image, with environment variables for database connection, webhook URL, timezone, and basic auth credentials

• PostgreSQL container — for persistent workflow and execution data storage (SQLite works but PostgreSQL is more reliable at scale)

• Caddy container — automatic SSL certificate provisioning and renewal. Point your subdomain (e.g., n8n.yourdomain.com) to your VPS IP address first

Set your n8n environment variables:

• N8N_HOST — your subdomain (n8n.yourdomain.com)

• WEBHOOK_URL — https://n8n.yourdomain.com/ (needed for webhook triggers to work)

• N8N_BASIC_AUTH_USER / N8N_BASIC_AUTH_PASSWORD — protect the admin interface

• GENERIC_TIMEZONE — set to your working timezone (e.g., Asia/Kolkata)

Step 4: Deploy and Verify

Before deploying, point a DNS A record for your subdomain (n8n.yourdomain.com) to your VPS IP address. Then:

1. Run: docker compose up -d

2. Wait 1–2 minutes for Caddy to provision the SSL certificate

3. Visit https://n8n.yourdomain.com — you should see the n8n login screen

4. Create your admin account and build a test workflow (e.g., webhook → respond with "Hello World")

Test webhooks by calling your test workflow URL. If you get a response, your n8n instance is fully operational with SSL.

Step 5: Set Up Automated Backups

Production n8n instances need automated backups. If your VPS fails, you need to restore all workflows and credentials quickly.

• Database backup: Create a cron job that runs pg_dump daily and uploads the backup to cloud storage (S3, Google Cloud Storage, or even a simple rclone to Google Drive)

• n8n workflow export: n8n has an API endpoint to export all workflows as JSON. Script this as a daily cron job alongside your database backup

• VPS-level snapshots: Most VPS providers offer automated snapshots (Hostinger, DigitalOcean). Enable weekly snapshots as an additional safety net

Test your restore process at least once. A backup you have never tested is not a backup.

Step 6: Production Hardening

Before running real GTM workflows, apply these production settings:

• Enable UFW firewall — only allow ports 22 (SSH), 80 (HTTP), and 443 (HTTPS)

• Set up fail2ban — blocks repeated failed SSH login attempts

• Use SSH keys instead of passwords — disable password authentication in sshd_config

• Set Docker restart policies — add restart: unless-stopped to all containers so they come back after a server reboot

• Monitor disk space — n8n execution logs can fill up disk. Set EXECUTIONS_DATA_PRUNE=true and EXECUTIONS_DATA_MAX_AGE=168 (7 days) to auto-prune

Cost Comparison

For context on why self-hosting matters:

• n8n Cloud Starter: $20/month — 2,500 executions

• n8n Cloud Pro: $50/month — 10,000 executions

• Self-hosted on Hostinger: ~$25/month — unlimited executions

A typical GTM pipeline processing 2,000 leads/month through enrichment, scoring, and routing generates 20,000–50,000 workflow executions. On n8n Cloud that exceeds the Pro plan. Self-hosted, it costs the same $25/month regardless of volume.