Now that I'm looking at it closer it is adding the retention period + the fee period increasing the delay to 180 days. Is this the intended behavior? What is the best practice for setting up a Forever forward backup?

My educated guess is that you are using Wasabi as your storage provider. In such case, please check out this article: https://help.mspbackups.com/billing-storage/storage-providers/wasabi/min-retention-policy

In a few words: this is indeed intended. Wasabi has early deletion fees that are by default 90 days. To avoid the extra costs there is an Intelligent Retention that postpones the deletion. With FFI it becomes a tad more complex, but still the right way to go to avoid the extra costs.

Also, after switching the minimal retention in both Wasabi and MBS (as per the above article) - there will be a "move over" period, as in: the 30 days work for new data only, data already on storage still has 90 days min. retention.

Yes I'm using Wasabi. I had them change my account to 30 day minimum long time ago but I didn't change the setting in MSP360 storage. So to be clear if I want an effective 90 day retention period I would use the setting 90 days + 30 minimum = 120max?

Once you set the FFI retention to 90 days, and the 90 days has passed, going forward, you will have one synthetic full and 89 incremental backups. Each night thereafter, a new synthetic full will be created , replacing the old , and including the incremental from the now 90. day old backup. Think of it as a rolling 90 days, where each nigh the software folds the oldest incremental into the most recent synthetic full and you get back to 90 days