March 19, 2025 | By christa

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How Much Should Your Business Spend on Cybersecurity?

• Cybersecurity

Cyber threats are a big deal for businesses of all sizes. The average cost of a data breach has reached $4.88 million in 2024, marking a 10% increase from the previous year.

This rise shows how important it is for companies to invest in cybersecurity. But how much should your business spend to stay safe?

Let’s dive in.

Why Cybersecurity Spending Matters

Cyber threats continue to evolve, putting businesses of all sizes at risk. In 2023, 43% of cyberattacks targeted small businesses, according to Verizon’s Data Breach Investigations Report. Additionally, the cost of ransomware attacks has skyrocketed, with global damages expected to reach $30 billion by 2024. Small businesses are especially vulnerable—only 14% are prepared to defend themselves against a cyberattack, as reported by Accenture. These figures demonstrate that cybersecurity shouldn’t be treated as an IT issue, but as a business-critical priority.

How Much Do Businesses Typically Spend on Cybersecurity?

Determining the right cybersecurity budget depends on factors like company size and industry. On average, businesses spend 13.2% of IT budgets on cybersecurity. Larger organizations or those in regulated industries, like healthcare or finance, may allocate 15-20% of their IT budgets to security, as they hold much more sensitive information — and thus have more to lose. 

Comparatively, a lack of investment can be far more costly, as according to IBM’s report, businesses on average will save over $2 million by investing in robust cybersecurity measures.

Factors That Influence Cybersecurity Costs

Not every business needs the same level of cybersecurity investment. Your costs will largely depend on your unique situation. For example, if you’re in healthcare, you’ll need to meet HIPAA requirements, while government contractors must achieve CMMC compliance. 

Each of these regulations comes with its own set of security demands (and associated costs).

The type of data you handle matters too. If you’re storing sensitive financial records or personal information, you’ll need more robust protection than a company dealing mostly with public data. Company size plays a big role — more employees mean more potential entry points for cyber threats.

And here’s something many businesses overlook: location matters. Companies in the Chicagoland area often face different threats than those in rural regions, and your security budget should reflect these regional risks.

Warning Signs and Smart Solutions

Is your cybersecurity investment falling short? Watch for these warning signs: outdated systems that haven’t seen updates in months, no dedicated IT security team, or a “fix it when it breaks” approach to security. If you’re struggling to pass security audits or meet industry regulations, that’s another clear signal it’s time for a change.

But here’s the good news — you can maximize your security budget without breaking the bank. Working with a managed security provider like LeadingIT often proves more cost-effective than building an in-house team.

We help organizations implement robust security frameworks, maintain compliance, and leverage modern cloud security solutions. No surprise fees, no hidden costs, just reliable protection for your business.

Ready to see if your cybersecurity investment is working as hard as it should? Get a free network assessment and let us show you what truly comprehensive security looks like. 

LeadingIT is Chicagoland’s trusted advisor for organizations with 25-250 users, specializing in IT and cybersecurity solutions that align with your business goals. We pride ourselves on delivering the unsolvable solved. Our unlimited support model ensures that your team always has the help they need, when they need it, with no hidden costs. Plus, our unbeatable 3 sets us apart: a seamless 14-day onboarding process, a rock-solid guarantee, and no long-term contracts. At LeadingIT, our mission is to solve IT right, 100% of the time, empowering growth-minded businesses to thrive securely and efficiently.