Are You Actually Profitable? How to Track and Increase Your Net Profit

May 20

You’re booking clients, sending invoices, and money is coming in, but do you actually know if your business is profitable?

If you're a content creator, social media manager, designer, or creative agency owner, it's easy to confuse being "busy" with being profitable. But the truth is, without a system for tracking your numbers, you might be working hard and still not seeing real growth. Let’s fix that.

What Does “Profitability” Actually Mean?

Profitability means your business is earning more than it spends. It’s not just about having cash in your account—it’s about knowing what’s left over after your expenses are paid. This leftover is your bottom line or net profit.

Why Creatives Often Miss the Mark on Profit

Many creatives don’t realize they’re underpricing, overspending, or not tracking their finances closely enough. If you’re not regularly reviewing your numbers, you could be:

Working on low-margin services
Paying for tools or subscriptions you don’t use
Forgetting to account for taxes or owner pay

How to Track Profit the Easy Way

You don’t need a finance degree to get this right. Here’s how to get started:

1. Track Every Dollar In and Out

Use a bookkeeping system to record all your income and expenses. Whether it's QuickBooks Online or a spreadsheet (like our Ultimate Bookkeeping Spreadsheet), consistency is key.

2. Review Your Profit & Loss Statement Monthly

This simple report shows your total income, total expenses, and net profit. If you’re not reviewing this monthly, you’re flying blind.

3. Categorize Expenses Wisely

Separate out business-related expenses so you can clearly see where your money is going: marketing, software, subscriptions, contractors, etc.

4. Budget for Owner Pay and Taxes

Set aside a percentage of your income for taxes and owner pay. That way, you’re not scrambling later.

5. Know Your Break-Even Point

How much do you need to earn to cover your expenses? Knowing your break-even helps you set realistic income goals and price your services appropriately.

How to Increase Your Bottom Line

Once you’ve tracked where your money is going, you can start to improve it:

Raise your prices based on the value you provide
Cut unnecessary expenses that don’t support growth
Focus on high-margin services that give you the most return for your time
Plan ahead using a tool like our Annual Budget Spreadsheet to keep your goals and reality aligned

You Don’t Have to Do This Alone

At Balanced Roots Bookkeeping, we help digital creatives understand and use their numbers to grow with intention. We don’t just record transactions—we help you create a roadmap to profitability.

Ready to understand your bottom line and increase your profits?

Visit our online store for DIY tools to get started, or 📅 book a free intro call today and see how we can help.

Let’s make sure your creativity leads to more than just client work, it should lead to profit, purpose, and peace of mind.

Elizabeth Tuchez