Categorizing Contacts

[chels_fred]

I use Outlook 2007 with BCM.
I am wondering the best way to categorize contacts for easy sorting and
accuracy. I currently have all of my contacts under the Business Contacts
folder and have 10 different color coded "categories" that I use to denote
whether the contact is a prospect, employee, or member of my networking
sphere. I am nervous using this system for sorting contacts as it is so easy
to accidentally change a category and file a contact someplace else. Also I
find it distracting to have 10+ different color coded labels of contacts all
lumped into one folder. Instead, I would like to create sub folders under the
Business Contact folder, 1 folder for prospects, 1 folder for network etc..
and then use the "categories" feature to further categorize each prospect by
which product they are interested in, or to further categorize my network by
what field they are in (lender, realtor, etc..)
What is the best way to do this? Would you create an "account" or is there a
way to create sub folders under Business Contacts?
Thanks!