I updated to mac OS Catalina and now I can't use Microsoft Word or Excel, why?

Did you upgrade Office to the current, compatible version? If you are using Office 2011 or earlier, they do not work with Catalina. You can buy the Standalone Office 2019 or subscribe to Office 365. Visit the Microsoft website to make your upgrade purchase. Before installing the new versions of Office, be sure to uninstall your old Office.

No. Your existing documents will be accessible by your new Office version.