Question about budgeting setup - is the best practice to make educated guesses for each category based on previous spending and then adjust in future months if you're off? Or am I supposed to actually be finding all the clothing we bought for the past year and totaling it as an annual amount in a "clothing" category, for example...

I think we did some combination of estimates and past spending at first, and then tweaked over the next couple months

You should be deciding at the beginning of each month how much you plan to spend on each category. If you have some months where you spend less and others more, then the months when you spend less you'll have money left over, giving you a bigger budget to assign to the categoies for the next month.

Guess and adjust as you go. Best not to overthink it. I find that focusing on getting it "right" makes it harder to actually use. the whole point is to be intentional with your $ choices not to be "morally" bound by some arbitrary number you came up with . so you actually adjust the current month if you guessed wrong, not just future months.

I definitely hear this... But it's hard to be intentional with your choices until you have a concept of what youve spent/what you need. Obviously if you look and see you spent, for example, a crazy amount of money on something optional like eating out or vacation, you can look at the previous spending and decide youre ok with it or decide you don't want to do that anymore. But on the other hand, mortgage, utilities, gas, groceries, medical expenses, insurance....the list goes on... I would think in those areas calculating what you've done in the past is the way to go.

guess and adjust as you learn more