Q on using indices as logical separation

Hopefully a simple question on using indices as logical separation within ES. If I understand the purpose of an index correctly, we should be able to use it for logical separation, ie a 'storage' index, 'compute' index, etc.

To set up a custom index, is the process create index -> set up the *beats.yml config file with the following:

output.elasticsearch:
index: “mynewindex”

setup.template:
name: “mynewindex”
pattern: “mynewindex-*”
enabled: true

Primarily I want to make sure I'm using the index in the correct way and there's not another more appropriate message for logical separation.