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Zack explains how to save a Word document on your computer for better organization and backups. He starts with an unsaved document and goes to the file menu, choosing "Save As." Alternatively, the disk icon or Ctrl + S can open the same menu. He navigates to the Documents folder, creates a new folder named "School 2014," and titles the document "Test Document." After saving it in the new folder, he demonstrates that the document remains saved even after closing it. Zack then shows how to access the saved folder in the Explorer window, confirming that the organization is intact.