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I use Prang brand colored pencils. You can use them dry or with a quick dip in water the color flows a bit easier. You can also blend them on the model part to get a closer match. The 36 color set.

I have also used artist's oil pastel sticks, but mostly the Prang pencils.

Try using one of those fingernail sandpaper files with the foam center to lightly sand away those dashed and dotted fold lines on parts with uniform or near uniform textures, then color the sanded line to match the surrounding texture. If you feel adventurous you could even try that on areas with busy textures. Some of those fold lines are so heavy that they detract from the overall look of the finished model, so some alteration is needed.