Some writers use cursive writing on a piece of paper. Some writers type into Notepad or TextPad or Word.
In the end it does not matter at ALL what you choose to put your story into when you are writing it. The only critical thing is that the story gets OUT of your head and onto the paper or screen. Your brain is a fickle organ. It comes up with brilliant ideas - and then it forgets them. The only important thing is that you get everything out of your brain, out of those little fragile neurons, and onto something more permanent. You can recite into a tape recorder. You can type into a smart phone. Everything works. Get those pieces and bits and fragments out and then you can start arranging, rearranging, modifying, and polishing until you have an ideal story.
Yes, at some point you are going to want to consolidate those notes, arrange those pieces, and create a coherent storyline (unless of course your story is a stream of consciousness experiment, in which case perhaps those little bits and tidbits are just perfect as is!). At that point you'll want to gather up your information into something which can at least spell check and grammar check for you. No publishing house is going to want to see a typo-ridden story. You absolutely must have all of those basic issues resolved before you do anything with your story, including sending it out to family and friends for review.
I happen to do my writing in Word. I write both at my main desk machine as well as a laptop which I can bring out on the back porch or over onto my living room futon. So I type away furiously in Word - I can type faster than I can handwrite - and not only does this let the story stream easily out of me but it also means that most spelling and grammar errors are caught as I go. This means the final proofreading process - when I am at the polishing stage - is a fairly quick one. At that point I'm only looking for strange typos like typing "reed" instead of "read" where both words are real words.
Another benefit of Word is that it has a "save as PDF" option so if someone needs me to send them a PDF to review, or an online publisher needs a PDF as their starting file, I am all set. I just take this document I've already written and hit the "save to PDF" button and am done.
If you are applying to a "regular publisher" typically they will want to see the first three chapters of your book in double spaced format. You would of course want to research exactly what their format is before sending them anything! But for example if it was three chapters double spaced then you just chop your story down to the first three chapters, hit the double spaced button, and save the new file with their publisher name. Quick, easy, done. You'd only of course be doing this when you were completely done with your story, so it would have no impact on how you wrote it.
If you decide to go with a self-publishing company, usually they want you to upload a PDF file of the book's content, exactly as you want it to be laid out. So again first you write, finish, and polish the book. Then it's simply a matter of hitting a 'save as PDF' button and you're done! The book is already written the way you wanted it (one would assume). So you're all set!
The key, really, is to JUST WRITE. Don't obsess about how you choose to write it. Don't worry about right and wrong. There is plenty of time for formatting and playing with fonts once you're done. Until you get the book complete, your main focus is on getting the details out of your head, onto something more permanent, and working through the construction process.
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