When you link a text file, changes made in the original will trigger a request to update the link in ID, but it is one-way only. There is no facility for moving the edits from ID back to the text doc other than exporting the story to RTF or text.
I've taken the time to create a Word document for each text file, but I feel like just going back to the old way. I want to do things right, but I just don't see the benefit of having a separate document and placing the text over just pasting the text in the InDesign file. Am I missing something?
Thanks for any help!
I think, Wordsflow of em soft does the thing you need, not free though
For short texts there may not be much advantage to placing text files, and maybe not even for longer files if you are the author, but the reason for placing Word files is that it is often easier to do the "writing" part in a word processor, or, maybe even more commonly, the person doing the writing is someone else without any access to the layout or InDesign. The reason for linking is to allow the author to make changes and let you pick them up in the layout. This type of workflow is more common in an environment with a separate author and layout team, and the project is on a fast track so the text is still in flux, or in a workflow where the same basic text is frequently updated.