One of my bigger issues anymore with YNAB is figuring out when is appropriate to use what sorts of goals (or scheduled transactions). I believe I read somewhere recently (or possibly heard during a workshop) that ideally you should use monthly funding goals when possible. But sometimes that feels less ideal. Worse, sometimes it feels like it's ideal some of the time but not others for the same category.
For instance, in my Fun Money category, I like to make sure I give myself at least $50/month to spend on things like movies or whatever. But if I don't use all of it and I add another $50 the next month it can add up quick. For some of these categories there's an upper limit (say, $200) past which I'd never want more than that allocated to that category.
Do I just have to switch the type of goal to a target amount after that point? Why can't there be a way for me to set a monthly goal up to a certain target amount? So that maybe after I get it to $200 I'll just keep putting in enough to top it off every month?
If I'm over what I need and try to transfer the money out to another category YNAB "penalizes" me by turning the category orange again, as if I'm underfunded for that month.
Maybe I'm just too used to thinking about this in one way and could use a different perspective. Thoughts anyone?
I remember thinking most all the things you mentioned, plus some. When starting believe I left most on monthly funding until I reached a certain point, then set a category balance goal, didn't like the result of this very much. Mostly ended up with a mix of monthly funding goals (fun, emergency funds, true and long term goals). Then for the annual or less frequent than monthly bills, were set up to be fully funded by the next time they were due. Today I look at the orange as something that needs to be looked into and possibly adjusted but not necessarily today.
When starting I would take the extra at the end of the month from various categories to fill in other categories, today not so much. For instance, I put $200 per month away for fun and rarely spend even half of that. And, I let it ride. This way, when that super fantastic vacation comes my way, I might have enough money set aside just for that job. I deserve $200 per month for fun. That is less than 2% of my income. I deserve that much and do my best to not set an upper limit or remove from the category, unless it's for fun.
Good luck finding something that works for you. Work with them and find what feels best, for you. What are your goals? What motivates you? Would recommend spending some time to discover what your own answers are. Very few hard core rules in budgeting, other than YNAB's 4. Find what motivates you.
1 You don't have to use goals for every category. A lot of people, particularly those who also used YNAB4 which didn't have goals, just put the standard budget amount and any cap in the category title e.g. Clothing £50 Cap £500. This gives you all the information you want from your goals and avoids the orange. The only disadvantage is that you can't use quick budget. I never do because I like to think about each category as I enter it anyway but for some people this will be a big deal.
2 You could use the YNAB Toolkit (not maintained by YNAB) which among many other useful things, lets you change the colour for underfunded categories to blue. This reserves orange for credit overspending. For me though, the best thing about the toolkit is the ability to add a running balance to your accounts.
3 You could change how you think about orange. Rather than thinking about it as being penalised, think about it as highlighting categories that need attention. That attention may just be looking at fun money and saying, "No, that's fine. I intentionally moved money away from this category. All good."
4 You could, as you suggested, change the goal type once you reach your target.
5 You could send a feature request to support requesting (a) a monthly template goal and (b) a monthly funding up to a cap goal.
These suggestions are not mutually exclusive.
How do I set the CAP goal? Say I want to only spend $300/month on groceries, if I use a monthly funding goal, when I spend money, it wants me to top it up. I need to only spend a certain amount. I get the flexible budgeting, but I'm resorting to paper to track my monthly categories when there should be a feature. :)