I have income coming in for my son with a disability from an Insurance company.
Should I record as income to be budgeted with payee specific or, put the funds directly to the category I have set up for any thing I spend directly relating to disability??
You should put income as to be budgeted. If you record it directly to an expense category, then it will net against your expenditures and you won’t have an accurate picture of what you spent. You can set up a master group specifically for your son’s expenses with individual categories for various expenses.
I second Jayne_m's suggestion. Income should be categorized as Inflow: To Be Budgeted for a number of reasons (including keeping your reports accurate). You can create a 'Disability' Payee to indicate the funds came from the disability pay out and create a category group for those funds if you want to separate what you spend it on. :)