Under Add a Recovery Contact I attempt to add my wife, who is on my family account, and I get the message ...you can only add contacts who are using iMessage (which I use with her every day) How do I fix this?

Hey karlwork,

Thanks for using Apple Support Communities. Make sure your wife meets all requirements to be added as your recovery contact. This guide has those details and more: Set up an account recovery contact - Apple Support

What does your recovery contact need?

Your contacts will need an iOS device with iOS 15 or iPadOS 15 or later, or Mac with macOS Monterey or later, and must meet the minimum requirements. Your recovery contacts won't have any access to your account, only the ability to give you a code if you need one. 

Requirements for setting up a recovery contact

* All of your devices must be running iOS 15, iPadOS 15, watchOS 8, or macOS Monterey or later. You might be prompted to update any devices not running the latest OS, or remove any devices that you aren't using.

* You must be over the age of 13.

* You need two-factor authentication turned on for your Apple ID.

With the alert mentioning she needs to use iMessage, make sure she's signed in to iMessage with her Apple ID too. Those steps can be found under "Sign in to iMessage" here: Set up Messages on iPhone - Apple Support

Let us know how it goes.

Take care!