Once these preliminaries are out of the way, you're ready to decide who has permission to peruse your file:
Open the Word document that you want to protect.
Choose File, Permissions, Do Not Distribute to display the Permission dialog box (see Figure 1).
Select the box marked Restrict Permission to This Document.
Enter the identifying email address of each person to whom you want to give Read or Change permission. If you want to allow full permission, type the email address in either box. You'll be able to change permissions on the next (More Options) screen.
If someone on your team routinely uses more than one email address, be sure to include all the applicable addresses.
If you're finished granting permissions, you can click OK. If you want to limit or expand the options shown here, click the More Options button to get an expanded Permission dialog box, as shown in Figure 2.
Select the desired access options. Here are a few examples that might not be self-evident:
To grant full permission, click the access level in the permissions list and change the level in the drop-down list to Full Control, as shown in Figure 3.
To set the document to expire, select the check box labeled This Document Expires On and then specify an expiration date.
To make your current settings the default settings for all future restricted documents, click the Set Defaults button. A verification dialog box appears, requiring you to click OK and alerting you that this action will set the default permission policy.
Click OK and then click OK again to close both Permission screens.
When someone receives your document in email and tries to download it or attempts to open it from a network or SharePoint server, he or she will see a message explaining the need to verify identity. When this is done, the document will open and allow only such permissions as you have granted.