How much money should I put into Facebook ads?

The answer: whatever generates 3x return on spend minimum. Not a dollar amount, a return multiplier. But if you need framework, here's practical: 0.5-2% of revenue reinvested in ads is healthy. $100k annual revenue? Spend $500-2,000 ads. $500k? Spend $2,500-10k. $1M? Spend $5k-20k. Top-end for aggressive growth, low-end maintenance.

But that's backward (allocating from existing revenue). Forward thinking: what budget reaches profitability first?

Minimum viable testing: $500-1,000 first month. Below $500, data's noise. Algorithm can't learn. $500 gathers 50-100 conversions typical (depending conversion rate). Pattern emerges. Enough to identify if model viable.

Sweet spot testing: $1,500-2,500 first month. Gathers 150-300 conversions. Clear signal emerges day 7. Allows 3-4 parallel campaigns testing different angles. High confidence week 2.

Aggressive testing: $5,000+ first month. Gathers 500-1,000 conversions. Multiple audiences, multiple creatives, multiple angles simultaneously. Redundancy for safety. But overkill if only one offer angle.

Timeline considerations:

If need revenue month 1: impossible (Meta takes weeks optimizing, minimum 2-3 weeks to first sale). Need revenue month 2? Possible (tight). Need month 3+? Comfortable scaling window.

By revenue urgency:

Desperate (month 1 revenue): no. Facebook ads wrong channel. Use organic, email, direct sales. Ads complement, not foundation.

Month 2 realistic: $1,000-2,000 budget, launch day 1, optimize week 2, scale week 3. First sales week 3-4. Revenue month 2 possible if product $500+.

3-month window comfortable: $3,000-5,000 total budget (month 1 testing, month 2-3 scaling). ROI clear month 2, aggressive scaling month 3. Revenue month 3 substantial.

6-month patience: $5,000-10,000 total budget. Leisurely testing, multiple refinements, compound scaling. Month 6 revenue potential $20,000-50,000+.

Business type guideline:

SaaS ($5,000/year ARR product): $2,000-5,000 monthly budget sustainable. CAC $100-500 acceptable. ROAS 5-10x (high AOV). Scaling aggressive.

E-commerce ($30-100 AOV products): $1,000-3,000 monthly. CAC $10-50 tight margins. ROAS 2-3x. Scaling moderate.

Local services ($500-5,000 project value): $500-1,500 monthly. CAC $20-100. ROAS 5-20x. Scaling easy (low competition locally).

Coaching ($297-1,997 course): $1,000-2,500 monthly. CAC $50-200. ROAS 3-5x. Scaling moderate.

Music promotion: $300-1,000 monthly. ROI weak (monetization slow). Positioning for discoverability, not direct revenue.

Dropshipping: avoid Facebook 2026 (margins, tracking, competition).

Personal calculation:

Calculate: what CAC (customer acquisition cost) is acceptable?

Product value ÷ Profit margin ÷ Desired ROAS = acceptable CAC

Example: SaaS $5,000/year, 70% gross margin, 5x ROAS target. $5,000 × 0.70 ÷ 5 = $700 acceptable CAC per customer.

That CAC? Spend $1,000 testing (14-15 customers), ROAS 5x = $5,000 return. Viable month 1.

Scale: spend $2,000 month 2 (30 customers), $15k return. Month 3: $4,000 spend, $30k return. Compounding.

Another example: E-commerce $50 AOV, 40% margin, 3x ROAS. $50 × 0.40 ÷ 3 = $6.67 acceptable CAC.

That CAC? Spend $500 testing (75 customers), ROAS 3x = $1,500 return. Month 1 profitable but tight.

Scale: spend $1,000 month 2, $3,000 return. Month 3: $2,000 spend, $6,000 return.

Seasonal allocation:

Quiet season (Jan-July): 60% baseline testing, 40% proven scaling. $1,000 = $600 test, $400 scale.

Busy season (Aug-Dec): 20% testing, 80% aggressive growth. $1,000 = $200 test, $800 scale.

Holiday peaks (Oct-Dec): 100% scale winners. Aggressive. 3-5x normal budget justified.

Cash flow reality:

Growing business: reinvest 50-80% profits into ads (aggressive growth mode). $5,000 monthly profit = $2,500-4,000 ads spend.

Mature business: reinvest 20-30% (steady state). $20,000 profit = $4,000-6,000 ads spend.

Startup phase: reinvest 100% (growth before profit). All revenue → ads.

Diversification budget:

Don't allocate all to Facebook. Split: - 40% Facebook (your primary) - 30% Google (intent-based lower funnel) - 20% TikTok (awareness/viral) - 10% test (emerging platforms, new angles)

Reduces Facebook dependency.

Risk mitigation:

Never risk more than you can afford losing. If $500 loss kills business, don't start. If $500 loss is learning investment, proceed.

Test before scale. $500 proves model, then $2,000 doubles down. Don't jump $5,000 before validation.

Parallel testing protect. $1,000 across 4 campaigns ($250 each) safer than $1,000 single campaign (if flops, all lost).

Real example: consultant $2,500 budget month 1.

Allocate: $1,000 Meta, $750 Google, $500 TikTok, $250 test.

Meta results: $1,000 spend, $3,500 return (ROAS 3.5x). Scale month 2.

Google: $750 spend, $1,500 return (ROAS 2x). Scale month 2.

TikTok: $500 spend, $400 return (ROAS 0.8x). Kill month 2.

Test: $250 YouTube, $100 return (ROAS 0.4x). Kill, not ready.

Month 2 reallocate: $3,000 total. $1,500 Meta (winner), $1,000 Google (proven), $500 TikTok test (new angle).

Month 3: $5,000. $2,500 Meta, $1,500 Google, $750 TikTok (if new angle works), $250 test.

Compounding: month 6, $15,000+ monthly spend, $50,000+ revenue monthly. From $2,500 seed.

Pitfalls: over-allocating too fast. Going $5,000 month 1 before $500 proves viability. Risk catastrophic. Under-allocating too long. Staying $300 month 3 when $1,000 proven profitable. Missed growth.

Tools budget tracking:

Spreadsheet: date, platform, spend, revenue, ROAS, notes. Update weekly. Spot trends.

Profit goal reverse: revenue target ÷ expected ROAS = required ad spend.

Want $10,000 revenue month? If ROAS 3x, need $3,333 ad spend.

Flex your budget: month slow (January, July)? Cut 30-50%. Month busy (December, September)? Increase 50-100%. Float money, don't dump fixed amounts.

Tools budget allocation: Ads Manager native auto-optimization handles allocation. Split Test feature compares audience/creative. Winner scales auto. Minimal manual input.

Contractor option: can't manage ads yourself? Hire contractor (Upwork, Facebook PMM agency). Cost $500-2,000/month. Handles setup, optimization, reporting. Profit split 60% you, 40% contractor reasonable. At $3,000 baseline ROI, contractor paying for itself.

Verdict: start $300-500/month testing. Measure ruthless (ROAS 3x minimum). Scale winners, kill losers fast. Double monthly if holding 3x ROAS. Cap at max you can afford losing (worst case ROAS tanks). Average healthy business 0.5-2% revenue invested in paid ads. $100k revenue? $500-2,000 ads. Spend less = slow growth, spend more = margin squeeze. Sweet spot middle, test find yours.