Is Your Business Profitable? How to Find Out in 5 Minutes

Money’s coming in, you’re keeping busy, and you feel like things are going well. But here’s the question: are you actually making a profit, or just moving money around?

A lot of solopreneurs assume they’re profitable because they have steady work. The truth? Without running the numbers, you’re just guessing. And guessing is dangerous, it can lead to overspending, underpricing, or committing to costs you can’t sustain.

The good news: You can find out in about 5 minutes. Here’s exactly how to check your profitability today, and what to do if you don’t like the answer.

Step 1: Gather Your Numbers (2 minutes)

You’ll need four simple figures:

1. Revenue – All the money your business earned this month.

2. Expenses – Everything you spent on business costs (tools, marketing, contractors, travel, etc.).

3. Tax Set-Aside – The amount you should be saving for taxes (usually 20–30% of profit—ask your tax pro for your exact rate).

4. Owner Pay – What you paid yourself (salary or draw).

Tip: If you’re using a tool like Cashflowy, you can pull all of this in seconds, no spreadsheet digging needed.

Step 2: Do the Quick Calculation (1 minute)

Formula:
Profit = Revenue – Expenses – Taxes – Owner Pay

• If the number is positive: You’re profitable.

• If it’s negative: You’re running at a loss for that period.

Step 3: Spot the Problem (1 minute)

If your profit is lower than expected—or negative—look at these common causes:

Common Profit Killers for Solopreneurs

• High expenses: Tools or services you’re not using, ad spend without clear ROI.

• Underpricing: Charging too little for the value you deliver.

• Late payments: You’ve done the work but haven’t been paid yet.

• Inconsistent owner pay: Taking more than your business can support.

Step 4: Make One Immediate Adjustment (1 minute)

To improve profitability right away, try one of these quick moves:

• Cut or downgrade one recurring expense you don’t use.

• Send a payment reminder for any overdue invoices.

• Raise rates for your next new client by 10–20%.

• Set a fixed owner pay amount that fits your business’s monthly profit.

Step 5: Repeat Every Month (No More Guessing)

Profitability isn’t a “set it and forget it” metric—it changes with your workload, expenses, and pricing. Set a 5-minute “Money Check” on your calendar for the first Monday of every month.

Over time, you’ll:

• See patterns in slow vs. busy months.

• Know when to save more aggressively.

• Have the confidence to invest in growth, without wondering if you can afford it.

Key Takeaways

• Profitability = Revenue – Expenses – Taxes – Owner Pay.

• You can check it in 5 minutes with four simple numbers.

• Repeat monthly for a clear picture of your business health.

• Small, quick changes can have a big impact on profit.

Make This Easy with Cashflowy

With Cashflowy, your “Am I profitable?” check takes seconds—literally.

• See exactly where you stand: how much you made, how much you owe, and how much you can keep—without hunting through spreadsheets.

• Never chase payments again: track overdue invoices and get paid faster with smart reminders.

• Get personalized guidance: your built-in Financial Coach gives you tailored tips to boost your profitability based on your real numbers.

• Run your finances in under an hour a month: stay on top of everything without letting it take over your week.

You don’t need to be an accountant—you just need clear, instant answers that help you make smarter business moves. Cashflowy makes that happen.

FAQs

What’s a good profit margin for a solopreneur?
Aim for at least 20–30% after taxes and owner pay, but the key is that your number stays consistently positive.

Should I include my own salary in the profit calculation?
Yes, profit is what’s left after you pay yourself.

What if my profit is negative for a month?
Cut a non-essential expense, speed up invoice collection, or review your pricing. One bad month isn’t the end, but several in a row means it’s time for deeper changes.

How can I make this faster?
Use a tool like Cashflowy to automatically track revenue, expenses, taxes, and profit so you see your numbers at a glance.