You’ll find some debate over which method is better for managing different types of contacts — have more than one Contacts folder (Personal, Business, etc.) or use one Contacts folder with categories. There are pluses and minuses for both.
Personally, I use a combination. I have a couple of separate Contacts folders that use special forms, plus I make extensive use of categories in my main Contacts folder.
Multiple Contacts Folders
One Contacts Folder, Multiple Categories
How to Create Additional Contact folders
To create additional Contact folders, right click on the Contact folder and choose New Folder. Enter a name for the folder.
If you don’t want it to be the subfolder of the Contacts folder, select a different folder before clicking Ok.