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How do I approach word problems?

One good way to do this is using something called "GRASS" format:

Given:  Identify the given information in the question...what values are given and what do they represent?  It may be helpful to know the following terms that are sometimes used in math questions and what they mean:
Sum + (addition)
Difference - (subtraction)
Product * (multiplication)
Quotient / (division)
Required: Figure out what the question is actually asking you to find. Whatever it is, represent it with a variable e.g., x. 

Analysis: If applicable, draw a sketch if one is not already provided. Figure out the appropriate math techniques to use and the formulas that relate the different quantities of interest. Whenever possible, use one variable only. For example, if you're looking for two numbers that differ by 5, then let x, and x+5 (or x and x - 5) represent the two numbers, NOT x and y. Alternatively, you may be able to use some info presented in the question to help you rewrite your equation in terms of one variable only. 

Solution: Solve the equation or find the answer you're looking’ll have to think hard about the various math techniques you’ve learned in your courses to figure out which ones work for this particular question. Make sure your solution(s) makes sense in the context of the application -- e.g., a negative area doesn't make any sense. 

Statement: Finish off with a concluding statement to make it clear what the answer to the question is. If applicable, include units in your answer. 

For more help on word problems, be sure to watch the videos on solving Word Problems, which will lead you through an example and provide more tips.
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