"How do I understand this word?" sounds to me like you are asking for a process rather than a definition. I'd be inclined to answer, "Well, you have to think about it like this: Suppose you were a farmer and you had ten cows ..." or whatever, some story like that. But "What does this word mean?" calls for a definition.
In any case, the conventional way to ask the question is, "What does this word mean?" (Or, "What is the definition of this word?") I'm sure there are many other phrasings that would be arguably correct, but they're just not what fluent speakers say.