500 KB is tighter than it sounds
At this size the arithmetic turns against scanned pages quickly. One or two scanned pages will fit and still look fine. Five will fit but start to look washed out. Beyond about ten scanned pages, 500 KB means a document that is technically a PDF and practically unreadable.
Text-based PDFs are a different story. A fifty-page text document is frequently under 500 KB to begin with, because text takes almost no space — it is images that cost.
When you need this size
Email systems with small attachment caps, older intranet upload forms, and some visa and university portals. It also comes up when a form limits you to a total across several files, so each one has to be small.
Getting more out of the same target
If your document is a scan that will not fit, check whether you need every page. Removing a blank reverse side or a cover sheet before compressing often does more than any quality setting. And if the original scan was made at 600 dpi, rescanning at 200 dpi will produce a smaller, cleaner file than compressing the large one down.
What you give up
Each page becomes an image, so text is no longer selectable or searchable. At 500 KB the compression is aggressive enough that fine detail — small print, thin lines in a signature — may visibly soften. Open the result before you send it. If it has gone too far, try 1 MB instead and see whether the limit really was 500 KB.