My backup server runs me about $90 per month and my hosting server runs about $400 per month. My other servers are somewhere in between. I am sure you will find a broad range of budgets. We have alot of clients paying $25 per month and one paying $2000 per month for a HA load balanced cluster.
Everyones budget I would assume be different based on needs.
If you are hosting clients or a company I would assume always go with the most powerful server you can get.
If it is just your sites or a business than I would say you would only need to get what is demanded by traffic and resource consumption. Of course it always good to allow for a margin of growth.