Word defaults to a "normal" style that sets up things like margins, font, paragraph spacing, and so on. You can use Word's default style, or you can set up one or more styles of you own. For example, you might set up a style that you use in letters. And if you find that you submit pleadings to a court that specifies font and margins, then you can set up a style for those pleadings.
A template lets you structure future documents. Why not create your own letterhead for all your job-hunting letters? How about a form for briefing cases for class? A template for your course outlines?