I get asked fairly frequently about what software I use when writing. I used to write using MS Word. Exclusively. Until I found something WAY better.
I participated in NaNoWriMo in 2011 and heard about one of their sponsors - Write Way Pro. I chose to try out their free 30-day demo then bought it 2 weeks into the trial. LOVE IT! I don't miss writing in Word at all. WWP was designed specifically for writers and has all kinds of really cool tools built into it. And the price was great!
Don't get me wrong. I still use Word from time to time. But it's more of a weigh station now. I no longer use it for writing.
Along with using WWP, I also heard on the ACFW Loop about a handy-dandy freebie edit helper called Smart Edit. You can't ask for better than free, right? I've got it customized to help me edit manuscripts. It flags things I want flagged, ignores things I want ignored, and in general helps me deal with some of my writing weaknesses (like overuse of the words "briefly" and "quickly" for some unknown reason). - UPDATE, this program is no longer available for FREE. It's been upgraded and now carries a cost.
Write Way Pro and Smart Edit are my choices. There are other options out there as well. Scrivener and YWriter come to mind. YWriter is a free software download available in a variety of places online. For those on a really tight budget, it may be right up your alley.
I've heard very positive things about Scrivener. Like WWP, Scrivener offers a free trial so you can check out the software and see if it's to your liking. Apparently there are some great tutorials for Scrivener on YouTube, so it should be very easy to learn for most people.
If you're a writer looking for writing software, I highly recommend downloading the free trial versions of these softwares. Try them out, see which one suits you the best. Then get writing!