An active imagination helps your grade-schooler in more ways than you might think.
Improving vocabulary. Children who play make-believe games or listen to lots of fairy tales, stories from books, or tales spun by those around them tend to have noticeably better vocabularies.
Taking control. Pretending allows your grade-schooler to be anyone she likes, practice things she's learned, and make situations turn out the way she wants. Stories where the brave young girl journeys through the haunted castle or imagined scenarios of rescuing her whole family from space invaders give your child a sense that she can be powerful and in control even in unfamiliar or scary situations.
Learning social rules. Getting along socially can be tricky at any age. When your grade-schooler and her pals script a talent show complete with costumes, songs, and dance numbers, she's not only being creative, she's learning complex, real-world rules about sharing, social interaction, and resolving conflicts.
Solving problems. Dreaming up imaginary situations teaches your child to think creatively in real life. A study at Case Western Reserve University found that young children who are imaginative tend to remain so as they get older and to become better problem solvers. Tested later in life, early "imaginators" were more resourceful when it came to coping with challenges and difficult situations, such as what to do if they forgot to bring a book they needed for school that day.