Cream together cream cheese and egg using a hand mixer until smooth and incorporated, about 2 minutes. Add vanilla extract and blend for another minute.

In a separate bowl, whisk together the dry ingredients: almond flour, coconut flour, sweetener, baking powder, and salt.

Slowly mix the wet mixture into the dry ingredients until fully combined. Cover and refrigerate the dough for at least 1 hour.

Preheat oven to 350°F (175°C) and line a baking sheet with parchment paper. Scoop dough onto the sheet, placing them about 2 inches apart.

Bake for about 15 minutes until puffed and just set. Avoid overbaking to maintain softness.

Allow cookies to cool on the baking sheet for at least 15 minutes. Dust with powdered sweetener if desired.