Categories vs. Multiple Contacts Folders
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
Outlook Categories and Color Categories
This page sums up a few things I've learned about Outlook categories and color categories, with suggestions for using and managing categories along with troubleshooting tips. Outlook has always supported categories; through Outlook 2003, they were simply Categories. Outlook 2007 introduced Color Categories by merging the short-lived colored flags with categories.

