Word should work fine, at least to start with. If it does everything you need, then that's all you need. If you want to do something more elaborate later, you might require a dedicated HTML editor, but by that time you would have a better idea of what to look for.
Without a lot of graphics, 5MB is plenty of space. If your ISP lets you have multiple email addresses, you may be able to get 5MB web space for each address.
