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If it's just for Wife & Friends, forget Amazon. Amazon doesn't really allow free and the upload is most predicable if you use epub2 format rather than MS Doc /Docx.
Use Calibre, import a "docx" file with a table of contents, where each line is a link to an anchor at each chapter heading. Though the "automatic" insert TOC can work if you edit settings so there are no page numbers.
Use paragraph styles. Use Level1, Level2 etc for chapters.
You can use MS Word or LibreOffice Writer.
Calibre can make just about any kind of ebook.
Smashwords allows free, but if it's just for people you know, you can just email them the ebook that Calibre makes. A Dual Mobi and an ePub2 will cover almost any model of Kindle and any model of "not-Kindle" except very very old Sony or Palm / WinCE PDAs.
Smashwords also distribute to Kobo, Apple, Tolino, Barnes & Noble, Libraries etc (almost everywhere except Amazon & Google Playstore/Books). For iOS, Kindle, Kobo, Nook, etc. They will have it free if it's set "Free" on Smashwords.
It's hard to do less than 99c on Amazon. Also ANY Kindle user can use an ebook made by Calibre or downloaded from Smashwords.
I do sell ebooks. We upload epub2 to Amazon and Smashwords. We upload "dual Mobi" from Calibre to Smashwords, which works with almost every Kindle, maybe every Kindle. We also upload MS Doc (from LibreOffice Writer) for Smashwords to make HTML, Palm, ancient Sony, text and PDF (you pick the options, we don't select PDF or text).
Epub readers and Kindle apps are free for phones and tablets.
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