I have not done this for a number of years, but in the past for my own and customer projects I would just run Postgres on the same VPS as the web app but use a

I have not done this for a number of years, but in the past for my own and customer projects I would just run Postgres on the same VPS as the web app but use a cronjob to write incremental backups every few hours to S3. As other people here have said, agreeing with you, paying for multiple availability zone RDS or paying Heroku is also a good plan.