I'd say that's pretty much the right answer, there'll be the odd time when you sell a player on for a massive profit and, at that point, then your gross spend becomes more of a factor, but overall, it's just about balancing resources.
Ideally the idea is that there is some level of growth there to support improving the overall quality of the squad. Net Spend and wage growth isn't a guarantee of improvement but it definitely helps the chance of improving just by having more resources available to work with.