I noticed no resolution to this thread so I'll share what I do.

I have small root volume on my M4 iMack so I moved my user directory to an external 2Tb drive where I created an additional separate volume for virtual drives.

So I create the bare bones of the xxx.utm file and leave it unloaded in my ~/Documents folder.
Next ,in Finder I drag and copy the xxx.utm file into the volume for virtual drives.

Back to the UTM app, I remove and delete the xxx.utm from the UTM app.
Then, I click the + button to start a new vm and chose the lesser option to "open". I find where I left the copy I made of xxx.utm and loaded it

Problem solved

Extra: you can create copies in a subdirectory of the .utm for fast restore or even just copies of the .qcow2 file to act as a snapshot if your setup crashes.