I cut 2" for wall hangings and 2 and 1/4 for quilts.
it is jut personal..whatever you think will work.
i will say, that i was showing my SIL how to put binding on, and i wish i had checked all the way around the quilt, by the time i got to the last side..i noticed when she squared up the quilt, some batting was showing, more than 1/4". i told her if we continued, and when she washed the quilt, it would probably fray at that point. you need to be sure that the binding has a good latch on the the quilt on the front.