I've been using Word for as long as I've used computers so that's what I prefer. Although pages is OK too, I just find Word more intuitive since I'm accustomed to that.
Do you have either of those? Or at least access to use the software? I'd suggest trying them out (friend, school computer, etc...) to see what you prefer. Pages has a free trial: http://www.apple.com/iwork/pages/
Also, Pages is part of iWork which is $79 so you get Keynote and Numbers too. Word is part of Office for Mac which is $150-$500 depending on which version you want, and with Office you get Excel, PowerPoint, and Entourage...
OpenOffice is free and fairly compatible with MS Office apps. TextEdit (comes with the OS) can do the basics and could likely get you by. There's also NeoOffice, which is based off the same code as OpenOffice. Those are some of the good free options.