Contact statuses are a great way to track the progress that you were making on a specific type of contact. For example,

Click CRM (contact relationship Manager)
Image Placeholder

once in CRM client list
click Status drop down
Image Placeholder

Click the drop down
Here you can see all the statuses 

Image Placeholder
To Customize CRM Contact status
Click Owners
Click System Settings
Image Placeholder

Click Action Type
Image Placeholder

Here you can see all the different types of Contact Status
Image Placeholder

Toggle on to show inactive status
Image Placeholder

To create click the Create icon
Image Placeholder
Add name and set as Active or inactive
Image Placeholder

To edit click Edit icon
Image Placeholder
Here you can change name and set as Active or inactive
Image Placeholder