With the Templates dialogue open (use the Demographics menu, then Create recall letter (Alt-D, C) you may edit or add a template quite easily. If you click on New template (Alt-N) the new record is added immediately, and the cursor is positioned over the Description column, ready for you to type in the description of the new template.
At the same time the basis of a new template was added to the display on the right; the Reserved Words look rather odd with their <triangular braces>, but they serve an important purpose. If your new template doesn't require any of the Reserved Words that were added automatically - delete it. The Editor will look for each of the Reserved Words and replace the Reserved Word with data, but if the Reserved Word is not there the Editor will not complain.
To open the Template Editor, either double click on the template display or click on the Edit this template (Alt-E) button. You now have the facilities available in a modern word processor - word and character formatting, fonts and indents.
You could also the File, Load menu item (Alt-F, L) to replace the text with a Rich Text File that you created in a 'real' word processor, then save the changes, and add Reserved Words later. It is also possible to save the existing text in the Template Editor to a Rich Text File, using File, Save as (Alt-F, A).
Be aware that when you click on File, Save and Exit (Ctrl-S) in the pop-up Template Editor it means that the Template Editor's text will be made to appear in the template, but you must still save the change in the Templates available for Letters dialogue. You will notice that the Post and Cancel buttons are now active above the list of templates - select Post to save the new template.
If you had imported a Rich Text File from an external word processor it is now possible to click on Insert Reserved Word, and the Reserved Word will appear at the point the cursor is flashing. If you put the Reserved Word in the wrong spot, highlight it and drag it to the appropriate location and drop it.
Select the Post button to save the changes, then you may click on either Create letter or Close.
For details on how to create a new letter, click here.