In order to encrypt word 2007 document:

1. Open word 2007.
2. Open the file needed to be encrypting.
3. Press the Microsoft Circle icon on the left.
4. Press "prepare" and choose "encrypt document".
5. Set encryption password and retype when asked.
6. When opening the file type the password.

In order to Decrypt word 2007 document: 

1. Open word 2007.
2. Open the file needed to be encrypting.
3. Press the Microsoft Circle icon on the left.
4. Press "prepare" and choose "encrypt document".
5. Set password to nothing (delete any mark on the password text box) and retype when asked.
6. Open the file- no password is needed now.