Organizing books on Kindle?

I don't have a particularly large collection, but I do like the idea of keeping things in folders organized by series or topic. I noticed an option labeled "create new collection" on my kindle paperwhite, but I don't know if it will play nice with books put on my kindle via calibre.

Any tips or ideas on keeping things organized would be appreciated. I would really like to do subfolders but just being able to keep everything in a series together is enough for me.