In YNAB, if you click on a red Available bubble to cover overspending, the dropdown menu shows your entire list of categories whether or not the category has a positive balance. In effect, the list is cluttered with every single category instead of just the categories that you can actually choose from.
The Hide Negative/Zero Categories When Covering Overspending is another one of those incredibly obvious improvements that you’d expect to find built into YNAB itself. With this setting turned on in the Toolkit for YNAB, the dropdown menu will include only categories with positive balances. From this pre-filtered list, it’s now up to you to decide which category will lose its funding to cover your overspending.
This setting combines nicely with the Make the Categories Dropdown Larger setting for maximum efficiency.