Having won promotion to the top flight with the biggest wage budget ever seen at Championship level, the Magpies spent relatively little last season but under the guidance of Rafa Benitez.
That modest spend - of around Â£45 million last summer - angered many on the terraces and frustrated manager Benitez, but the Spaniard managed to guide United to a 10th placed finish.
And having hit target no 1 - stay in the division - Charnley thinks Newcastle can progress in the top flight by spending what they have, not what people want them to.
Speaking to the Mail, he said: "This year was about staying in the Premier League and now it’s about growing and improving year on year, but doing that within our means.
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"That's not to say there is a lack of ambition, because there definitely is ambition, it will just take some time.
"It’s not like we’re sat on a big pot of cash keeping it for a rainy day.
"Money comes in, money goes out and what’s left is available to spend, it’s that simple."
United's recent accounts release revealed just how much dropping out of the money-spinning top flight cost United in real terms.
Revenues dropped, debts increased and losses were high.
Charnley admits backing Benitez was a calculated risk which ultimately paid off.
"It would have been a catastrophe, a bloodbath," said Charnley about the prospect of Newcastle not getting promoted from the second tier last term.
"The manager would likely have gone. This was a one-season gamble from his view as well.
"Some of the players would have wanted to go. Matt Ritchie, for example, bought into this on the basis of, 'One year in the Championship then I am going to the Premier League'.
"And then we would have had Financial Fair Play. You cannot operate a business continually that has a wage bill higher than its turnover, it’s not sustainable.
"We’d have had no choice but to recruit Championship players. Three teams then come down with more money than you and you end up on this cycle of trying to catch them. You have to reset financially. It would have taken years to get out of the Championship."
Benitez is currently locked in talks to potentially extend his deal at St James's Park.
What he wants and what the club want moving forward is the main crux of negotiations.
Do the club share their manager's ambitions, can they deliver on the issues he wants addressed re the academy etc and will they allow him the kind of control over transfer dealings he was afforded in the months after the drop out of the Premier League?
Whatever the future holds, Charnley is full of praise for his manager, as well as issuing a spending warning in the process.
"He, and the talented staff around him, are incredibly professional, meticulous and focussed. We have seen the benefit of that," said the managing director.
"What Rafa has certainly done is improve the group of players on a whole. I look at Jamaal Lascelles from when he came in and he’s made huge strides.
"We have got a group now who have an incredible spirit, work ethic and a real togetherness.
"If you look to improve going forward, it’s a real fight to get the balance between improving the quality of the individuals and also retaining that team ethic. To find the two is not always easy - and potentially very expensive."