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Categories are also useful for contacts
I have been using categories for since they were introduced in Sheduler+ in about 1996, initially for contacts as I had about 1800 in my list at the time. Many contacts belong to more than one category, they are then easy to find by the context you are currently thinking in. The same categories are used for my appointments, here you have to remember that the colour assigned will be that of the last category assigned to the appointment. You can also create a view that lists appointments or contacts by category.