Imagine a coordinate plane on which your implementation of a Beeminder goal lives.
The x-axis corresponds to how expensive the goal is - higher (maximum) pledge amounts are further East.
The y-axis corresponds to how lenient or strict you are in your implementation, rules, and fine print of the goal. If you have a lot of fine print that carefully rules out a lot of situations where you might call non-legit, and you follow that, that would be more strictness, and would be further North. No-excuses mode is very far North. Having to submit proof would also be far North. Calling non-legit for anything and everything would be very lenient and very far South.
So, that leads to four “cardinal errors” for Beeminder goals, one for each cardinal direction:
Too far North - too strict. Problems from this include losing a lot of money in a real emergency or when you’re sick, reneging on your promise to pay because it’s so much and feels too strict, or giving up because it’s too overwhelming.
Too far South - too lenient. This can cause your standards to erode until you call non-legit on everything or find a way to circumvent everything.
Too far West - (maximum) pledge amounts too low. This can cause you to just choose to derail more often than you’d like.
Too far East - (maximum) pledge amounts too high. This can cause frustration, financial loss, reneging, or giving up, and also lead you to sacrifice your health or other important things to make sure you never derail even when it would be better to derail.
Also of importance, though not included in this 2-D model, is how hard the goal’s setup actually is - for instance, you can always lower the rate or turn weekends off to make a goal easier.
The point here is that there is no perfect setup - any setup is going to be prone to error in some of these ways. Too strict, and you suffer in a real emergency; too lenient, and your standards erode.
One key is to have a mix of different locations on the plane with all your different goals. For instance, I have half my goals in no-excuses mode, so I don’t just call non-legit on everything, but still don’t lose everything when I’m actually sick.