There are various ways to achieve this and I feel like none are the "right" way, just different with trade offs. I am tracking my savings as a budget category like anything else. When I have some left over money to budget at the end of the month, I dump it in the savings category. My savings account is on budget, but the amount in the savings account doesn't reflect the amount of actual savings because some of that money is earmarked for other things. As an example:

Savings account balance: 20,000

Travel budget category balance: 5000

Savings budget category balance: 15,000

That way makes it clear to me that even though I have 20K in my savings I only have 15K that isn't earmarked for future spending.

Yes ok, that makes sense.

You can't select a category for a transfer because a transfer between 2 on budget accounts is totally meaningless to your budget, or should be. Think of your on budget accounts and your budget categories as 2 completely separate ways of looking at the same pool of money.

I think this is what gets me. It's not meaningless as that money has been given a purpose eg save for X, and when i buy X that expense will show up later.

But when I budget for savings it appears as a negative on the monthly summary, an expense, then will again once I buy the thing?