So what would you do? Suppose you need an extra $500 this month to buy your Rainbow Unicorn on time. You can either:
(1) Budget $500 less to Other Stuff and $1000 more to Rainbow Unicorns. Run the risk of overspending in Other Stuff.
(2) Budget only $500 to Rainbow Unicorns and pray for a surplus in Other Stuff at the end of the month to transfer to Rainbow Unicorns. Run the risk of underachieving your goal.
(3) Budget $1000 to Rainbow Unicorns, going $500 Overbudget. Use this Overbudget as a motivator to live frugally and/or work overtime to close the gap.
I guess (1) and (2) are more "proper" but I find myself naturally doing (3). I can't explain it well. I just don't like shortchanging individual categories. I like to know, at the aggregate level, whether I am achieving my goals or not, and use that overall sense of feedback to adjust my daily behavior.
For example I am $11k Overbudgeted right now. That includes a lot of buffers in individual categories, that I want to have. Rather than slowly build up those buffers, I just directly set them to what I wanted them to be, go Overbudget, and now work like heck to close the gap. I like having that Aggregate at the top that tells me how much I'm short by.
3 months ago I was $20k Overbudgeted so I've made progress! I think I've made progress faster than if I had Budgeted to $0 and let my individual Categories starve.
I also somehow find it easier to be frugal in a category when I budget a lot. For example because I budgeted $600 to "Eating Out", I feel like I don't have to eat out, because I know it's "always there" if I need it. But if I aggressively only budgeted say $100, I would "feel poor", and would feel more pressured to spend. I can't really explain it.
So in other words I like to have Category surpluses, and Aggregate deficits.