Google Ads is an exceptional marketing tool that can help you get a competitive edge over others. However, many people are not sure about the amount they want to put in for their Google Ads campaign.
They are not sure about the payment threshold and how it works. To help you out, we will give you a brief idea of the payment threshold and how it works. Let’s get right into it.
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Understanding The Payment Threshold In Google Ads
Let’s say you have added a card with a balance of £250 to your Google Ads account. The payment threshold is £50, so every time you cross that threshold, Google will bill your account. To clarify, every time you spend more than £50, Google will charge your card.
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Get my plan →Therefore, a budget of £250 will be consumed after you use Google Ads five times. A critical takeaway is that there is no link between the billing threshold and the budget you set for your campaign. It is where many people get confused since they are not sure what amount they want to put in for their budget.
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So, if you want to spend £250 or £1000, it is up to you to decide depending on your needs. Let’s say you choose the budget of £250 for the entire month. If you spend £50 each day, it will dry up your budget after five days on the £50 payment threshold, and Google will charge you.
As you continue to put in more and more money, the payment threshold will continue to go higher to £500, £1000, £2000, £5000, and more. Simply put, the campaign budget does not have to do anything with the payment threshold since you can spend as little as you want.
Essential Points To Keep In Mind
One of the vital things to note is that Google Ads does not bill you after the end of the calendar month. Instead, you will have to pay the bill after reaching your threshold, or once 30 days pass by.
Since the billing works on the payment threshold, you might find yourself getting charged more than once within the calendar month. So, if you are dealing with clients, you should inform them about this beforehand. It will help you avoid problems in the future.
Most importantly, it is best to inform your clients so that their credit card does not get declined. If the credit card does not work at any point, the threshold will automatically go back to £50. As a result, you will have to go through the entire process again, impacting your campaigns.
Written by Uzair Kharawala
Partner at SF Digital Studios, a Google Premier Partner agency. Uzair has been helping businesses grow with Google Ads since 2002 and teaches it every week on YouTube.
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