Live with wife in small valley (5)
I believe the answer is:
dwell
'live' is the definition.
('dwell' can be a synonym of 'live')
'wife in small valley' is the wordplay.
'wife' becomes 'w'.
'in' means one lot of letters goes inside another.
'small valley' becomes 'dell' (I've seen this before).
'w' inserted inside 'dell' is 'DWELL'.
'with' acts as a link.
(Other definitions for dwell that I've seen before include "Settle" , "Exist (within)" , "Live (in a place)" , "Remain" , "Abide, reside" .)