We even occasionally forgive what the kids know should otherwise be punished to provide a picture of grace to the kids.
While this may seem weird to some people, I taught my kids to ask for mercy and grace. After they did something wrong, If they asked for mercy I would forgo the punishment and even show them after their plea for forgiveness that I whole heartedly loved them and expected them to keep up the fight to do what is right. I really believe 1 John 1:9 is one of the most important scriptures in my life as an adult. It is for children also and I tried to show it to them by openly repenting in front of my kids and seeking for that same forgiveness. I love 1 John 1:9.
(1Jn 1:9) If we confess our sins, he is faithful and just to forgive us our sins, and to cleanse us from all unrighteousness.