Cannot set Trusted Location for my iPhone

I often go out with my Apple Watch, leaving my iPhone at home. When I get about 2 blocks away, I get a notification on my watch that I left my iPhone behind. OK, so far. However, sometimes I get an option to select "Trusted Location" (most times I do not). Since I know my iPhone is at home, I select "Trusted Location" (thinking that will suppress the warning when my iPhone is at home). However, when I select that, it just spins for a few seconds, then says "No devices found", and I continue to get the notifications.

Is this a bug? Is there a way to suppress the warning when my phone is at home?

I have tried to add my iPhone on the Items tab in Find My, but that does not work.

Also should note that I have the GPS-only watch.