How Much Should I Spend on Facebook Ads? A General Budget Guide

One of the most common questions we get: "How much should I spend on Facebook ads?"

The answer isn't a magic number. It depends on your business model, profit margins, customer lifetime value, and what you're trying to achieve. But there are guidelines that can help you set a realistic budget and avoid wasting money.

Here's what you need to know.

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A Quick Note Before We Get Into Numbers

This guide is based on what we've seen work across hundreds of accounts. It's not a prescription for your specific business. If you're just starting out, don't have a proven offer, or haven't validated product-market fit, spending $50K/month won't fix that. These budgets assume you have a functional business, a quality product, a working website, and an offer people actually want. We highly recommend you start small, prove the fundamentals, then scale.

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The Minimum Budget to Typically See Results

Facebook's algorithm needs data to optimize, and the truth is, your ad spend is what pays for that data. If your budget is too small, the platform doesn't have enough information to learn what works, and performance suffers.

General rule of thumb:

Minimum $30-50 per day per ad set for testing
$3,000-5,000 per month to gather meaningful data
$5,000-$20,000+ per month to scale consistently

If you're spending less than $1,000/month, you're likely not giving Facebook enough room to optimize effectively. Results will be inconsistent, and you'll struggle to draw reliable conclusions.

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One Approach: Start With Your Customer Acquisition Cost (CAC)

The right budget depends on how much it costs to acquire a customer and how much that customer is worth to your business.

Here's the formula:

Customer Lifetime Value (LTV) ÷ Target Customer Acquisition Cost (CAC) = How Much You Can Afford to Spend

Example:

Your product sells for $100
Your profit margin is 40% ($40 profit per sale)
You want a 3:1 LTV to CAC ratio
That means you can afford to spend up to $13 per customer acquisition

If Facebook is delivering customers at $10 each, you're profitable. If it's costing $25, you're losing money.

Know your numbers before you set a budget. Modelling out a system like this is complex, and something we help our clients do all the time.

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Budget by Business Type

Ecommerce/DTC:

Testing phase: $1,000-3,000/month
Scaling phase: $5,000-20,000+/month

Ecommerce brands need volume to hit profitability. Lower budgets work for niche products with high margins, but most brands need at least $5K/month to scale effectively.

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Lead Generation/B2B:

Testing phase: $1,500-5,000/month
Scaling phase: $5,000-15,000+/month

Lead gen campaigns tend to have higher cost per lead but also higher customer lifetime value. Budget needs to account for longer sales cycles and nurturing.

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Local Services (contractors, healthcare, etc.):

Testing phase: $500-2,000/month
Scaling phase: $2,000-10,000+/month

Local service businesses can see results with smaller budgets due to tighter geographic targeting and higher-value conversions.

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Healthcare:

Testing phase: $2,000-5,000/month
Scaling phase: $50,000-100,000+/month

Healthcare companies often have complex funding streams that support larger budgets and significantly higher customer lifetime values. The range is wide because it's entirely company-dependent, but the unit economics tend to justify aggressive spend.

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What Happens If Your Budget Is Too Low?

Under-spending creates problems:

Facebook can't gather enough data to optimize
You'll see inconsistent results day to day
Cost per result stays high because the algorithm never learns
You're basically paying to test without ever reaching the optimization phase

If budget is tight, it's better to run ads for fewer days at a higher daily spend than to stretch a tiny budget across weeks.

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What Happens If Your Budget Is Too High Too Fast?

Scaling too aggressively before you've proven what works is just as dangerous as under-spending.

If you jump from $1K/month to $10K/month without testing creative, audiences, and offers, you'll burn through cash with no guarantee of better results.

The right approach: Test at a manageable budget, identify what's working, then scale gradually (20-30% increases week over week).

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How to Allocate Your Budget Across Campaigns

Don't dump all your money into one campaign type. Split your budget strategically:

60% - Prospecting (cold audiences): New customer acquisition. Testing interests, lookalikes, and broad targeting.
30% - Retargeting (warm audiences): People who visited your site, engaged with content, or added to cart but didn't buy.
10% - Testing: New creative angles, messaging, and audience experiments.

This split ensures you're balancing growth with efficiency.

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The Real Value of Testing (And Why It Matters When You Scale)

The best thing about building a proper testing system is what happens after multiple rounds of refinement: you end up with something worth its weight in gold. When you increase spend, you're pouring budget into something that's already proven to win. That's the value of testing. No money wasted on campaigns that don't work.

Once you know what converts, scaling becomes straightforward. If you maintain a 5x ROAS (Return on Ad Spend: meaning for every $1 spent, you make $5 back) at $50/day, you're generating $250/day in revenue. Maintain that same 5x ROAS at $500/day, and you're making $2,500/day. Scale it to $5,000/day? You get the idea.

Ads allow for real-time budget optimization. When performance is strong, we scale quickly and profitably. When it dips, we pull back, diagnose what's happening, revert to testing, and scale again once we've figured it out.

Does it always work that smoothly? No. Honestly, it often doesn't. But because of that real-time flexibility, we can adjust fast: cut spend when needed, identify the issue, fix it, and push forward again.

99% of the time, the next phase of scaling takes things to the next level.

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When Should You Increase Your Budget?

Scale when:

Your cost per acquisition is profitable and stable
You've tested multiple creative angles and know what works
Your conversion rate is consistent over at least 2 weeks
You have inventory, capacity, or resources to handle more volume

Don't scale just because a campaign had one good day. Wait for sustained performance.

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Final Thought

There's no universal "right" budget for Facebook ads. The right budget is the one that aligns with your unit economics, allows the platform to optimize, and scales profitably based on real data.

Don't let some ad guru, YouTube video, Reddit post, or inexperienced friend convince you there's a magic number. There simply isn't. Your business is different. Your margins are different. Your goals are different.

If you're not sure where to start or how much you should be spending, let's talk. We'll help you set a realistic budget and build a strategy that actually works for your business.