We are now doing whole words in with phonics. We borrowed "Just Like Dora" from the library (it has about 39 new words). I haven't shown Hannah the book yet, just teaching her the words. Once she knows the words for the 1st sentence, I'll put that up on our dry erase board and she can read the sentences individually before she reads them in the book.
I am using Glenn Doman's method for teaching whole words. You get 5-10 words and print them about 1-2" tall on flashcards. My flashcards are 3 1/2" tall by 8 1/2" wide and are made out of card stock. You show these words for 5 days (3x a day) and then start adding 1 new word a day after that.
4 weeks ago