Go to OBJECT from the INSERT menu of Mail Merge and use CREATE NEW to choose MICROSOFT WORD DOCUMENT from the "Object Type" window.

Select OK and make sure RULER is checked in the VIEW menu of your new Word Document. Click on your Word Document bounding box and resize it to the width of your envelope. After selecting TEXT BOX from the INSERT menu of Word, click and drag the crosshair cursor to create text box.

Type your address into the text box you just created. Now click off your text box to deselect it. From the PICTURE sub-menu, select a graphic category and choose an image to insert. You can reposition the text and graphic by clicking and dragging them to your desired location. to return to Mail Merge, click on the Mail Merge document screen.