For digital art, I used to use paint shop pro, but have turned off that (the brushwork is acting really slow for me in it) in favor of photoshop elements 2.0 that came with my tablet CD. It's kind of small... the painting is similar to the regular photoshop--just in a dinkier way. I'll live with it until I can get my hands on photoshop.
For other means of coloring... I mostly been using colored pencils so far. I got prismacolors recently, but most of my colored pencils so far that have been done were the cheaper ones I dug out of the garage somewhere. Some of my colored pencils are....
Crystal
Earthwoman
Christmas Display
Ruby the Elf
When I was just starting to want to color things... well, I couldn't try anything as daring as paints (though I'm working on getting into acrylics and watercolors), and colored pencils were the only thing I had around the house besides crayons.. I've gotten to like some of the results I've gotten with the colored pencils.
Personally, there's an artist online whose art I adore and she uses a very interesting combination that I really want to try... she uses markers for the main character or subject, and then uses water colors for the backgrounds--and it made a really nice final affect. ^_^
--star