Can you use colors to show the changes being made to your files? Yes definitely.
If you are a programmer you will probably use a Diff tool for example DeltaWalker Pro. You might use this with Git.
If you use macOS you might use file tags in Finder. You might use this to keep track of editing that you are doing in MS Word to multiple files.
Whatever your tool here are my favorite colors for indicating the type of change:
- Additions: Green
- Changes: Orange
- Conflicts: Red
- Deletions: Cyan