The colored laundry baskets are a great idea! At our house, we use hampers with lids for dirty laundry. On top of the lids are stuffed animals; the color of the stuffed animals indicates what goes inside. For example, a white and yellow stuffed animal is for whites and lights. (We use this system because the hampers are all blue.)
We also had color coded sippy cups when the kids were smaller. Red sippy cups held apple juice, blue sippy cups held water, and green sippy cups held milk. Color coding worked with our kids when they were as young as 1-1/2!
As for chores, my seven year old son is expected to clean up toys, rinse out the sink after brushing teeth, help make his bed, feed his hamster, assist in cleaning his hamster's cage, carry his dirty dishes to the sink, and help take garbage outside. Sometimes he assists with laundry by bringing me a hamper or folding towels. Sometimes he assists with grocery shopping by helping push and load the cart. And sometimes he helps clean the cats' litter boxes. Oh, and he BEGS to push the Swiffer Sweeper around the kitchen.
My three year old daughter clean up her toys, attempts to fold blankets and towels, pairs socks together for me to fold, gives the cats cat treats and the hamster carrots, and helps load groceries into the cart. Sometimes she tries to carry her dishes to the sink, but that can be disastrous at times.
Oh, and both kids at times help prepare meals and help set the table. In fact, my son LOVES to "cook," and my daughter likes to set the table unassisted.