Setting a budget is one of the first things you do in a Google Ads campaign. It is also one of the most misunderstood. Many people expect the daily figure to be a hard limit, then get a surprise when one day’s spend comes in higher.
Google calls the main setting an average daily budget. The word “average” matters a great deal. Once you know how it works, the numbers on your bill make a lot more sense.
What an average daily budget means
Google defines the average daily budget as the average amount you set for each campaign on a per day basis. It is set at the campaign level, so each campaign has its own figure. You can set and edit it at any time.
The budget works across the month rather than day by day. Google spends more on days when it expects more clicks and conversions. On some days you may not reach your average daily budget, and on others you may go over it.
The Google Ads guide to average daily budgets explains this pacing in plain terms. It is worth reading before you launch a first campaign. It also explains how the daily figure links to the monthly total.
Why one day can cost more than your budget
For most campaigns, the daily spending limit is two times your average daily budget. So a campaign with a $20 average daily budget could spend up to $40 on a busy day. Google does this to make use of days when traffic is higher.
This can look alarming if you check the account every morning. A single high day is not a fault in the account. It is part of how the average budget is meant to work.
It helps to look at spend over a whole month instead. That is the period the limits are built around. Checking weekly totals gives a clearer picture than reacting to each day.
The monthly charging limit
For most campaigns, the monthly spending limit is 30.4 times your average daily budget. The figure 30.4 is the average number of days in a month. A $10 average daily budget gives a monthly limit of $304.
To work out a daily figure, divide what you are happy to spend in a month by 30.4. Google says you will not be charged more than your monthly charging limit. If your ads are shown so much that the cost goes over the limit, an overdelivery credit is applied to your account.
Google separates two kinds of cost. Served cost is the cost of all clicks or impressions a campaign received. Billed cost is the amount you are actually responsible for paying after adjustments such as overdelivery and invalid activity.
Changing your budget partway through a month
A budget change also changes the monthly limit for the rest of the month. After a change, your spend for the rest of the month will not go past the new average daily budget for the days left. The monthly limit becomes what you have already spent plus the new daily budget times the remaining days.
Google gives an example. A $10 daily budget that is raised to $50 with five days left, after $270 has been spent, gives a monthly limit of $520. Lowering it to $5 a day instead gives $295.
If you change the budget more than once in a day, the daily limit uses the highest budget set that day. The monthly limit only counts the latest one. Changing a campaign’s end date also counts as a budget change. The Google Ads help page on budget changes sets this out with more examples.
Shared budgets and campaign total budgets
Google also lets you create shared budgets. A shared budget sets one amount across several campaigns, rather than giving each campaign its own figure. This can suit a business running a few small campaigns with one overall spending target.
There is also a campaign total budget for fixed periods of 3 to 90 days. It is available for Search, Shopping and Performance Max campaigns. Unlike an average daily budget, it acts as a hard cap for the whole run of the campaign.
A total budget can suit a sale or event with a clear start and finish. Google recommends keeping changes to a minimum once such a campaign starts. Each change makes the system recalculate how it paces the remaining spend.
Tracking spend with the budget report
The budget report shows how much a campaign is projected to spend by the end of the month. It also shows the monthly spending limit, cost to date and each day’s spend against the daily limit. A tool called Budget Explorer lets you test a different budget and see the forecast change.
You can open the report by hovering over the budget on the Campaigns page. It works for campaigns using average daily budgets with dates that include the current month. Google notes that Performance Max campaigns are not compatible with the budget report.
The Billed cost report in the Report editor compares served cost with billed cost. The difference between the two shows any overdelivery. You can export it as a spreadsheet file to check several campaigns at once.
Making each dollar of budget count
A budget only works as well as the page people land on. Clear structure helps visitors find what they came for. Good use of H tags on your web pages makes a landing page easier to scan.
Paid ads and organic search often support each other. A firm that has put work into local SEO for family lawyers can use ads to fill gaps while rankings build. The budget then covers the searches that are hardest to win without ads.
Your website setup also affects results. If you are thinking about paying someone to build your WordPress website, ask how forms and calls will be tracked. And if you are relocating your business, review where your ads are shown before the move.
Frequently asked questions
Can Google Ads spend more than my daily budget?
Yes, on a given day a campaign can spend up to two times its average daily budget for most campaigns. Across the month, charges stay within the monthly limit. That limit is 30.4 times the average daily budget.
Will I be charged for overdelivery?
No, Google says you will not be charged more than your spending limits. When served costs go over the monthly limit, an overdelivery credit is applied. The Billed cost report shows the difference.
How do I set a daily budget from a monthly amount?
Divide the monthly amount by 30.4. For example, $304 a month works out to a $10 average daily budget. You can adjust the figure at any time.
Is there a way to set a fixed total for a short campaign?
Yes, a campaign total budget covers a set period of 3 to 90 days. It works for Search, Shopping and Performance Max campaigns. It acts as a hard cap for the whole campaign.
Google updates its budget tools from time to time. Check the help pages before making big changes to how you spend.