This is by no means a daunting task but is one I constantly forget how to do. In typical MS fashion, there is no menu link for it, instead it is well hidden.
I normally write my document first including chapter numbers, then I add the ToC when I'm done.
To add a Toc
Insert -> Reference -> Index and Tables
When the option box comes up, click the 'Table of contents' tab. From here there are a few options that you can modify.