Good afternoon milam2,
Welcome to the Apple Support Communities!
I understand you would like to increase your iCloud storage to 2 TB and set up Family Sharing with your wife. The resources below will help you with this. Your wife can create an archive of her iCloud data if she wants before accepting the Family Sharing invitation. If you share a computer, create an admin user account for your wife so that her data is kept separate from yours on the Mac. I've highlighted some key information here for you. Click on the links for complete details.
Set up users, guests, and groups on Mac
Archive or make copies of the information you store in iCloud
Family Sharing
"Share an iCloud storage plan with your family.
Now you can share an iCloud storage plan with your entire family. Choose a 200GB or 2TB plan to give everyone enough space to store photos, videos, documents, and more. It’s easy to see how much everyone is using, and you can upgrade to a larger plan at any time. Learn about iCloud storage plans and pricing.
When you share a storage plan, other family members won’t have access to your content unless you choose to share it. And if an adult family member needs more space or wants to use their own iCloud storage, they can choose their own storage plan and still remain part of the family."
Enjoy your day!