Set up an index card box with a separate tab for each letter of the alphabet. This will help to keep your Montessori based movable alphabet organized later on.
Write, using a red marker, each vowel of the alphabet, "a, e, i, o and u" and the letter "y" on five index cards. Write clearly in lowercase letters and make sure that you try to make the letters about the same size. You will have five "a" cards, five "e" cards and so on.
Make five cards each, using a blue marker, for the remaining twenty letters. Use lowercase letters and again try to make all letters as close to the same size as possible.
Lay the cards out in piles on a flat surface. Place the vowels and "y" cards along the top and the remaining cards in random order.
Begin by sitting with your child and taking one pile of vowel cards. "A" is the easiest to begin with.
Place the five "a" cards in a column in front of the child. Say the short "a" sound as you place each card down. This is the sound that you hear in the beginning of words like "apple" and "alligator"
Choose one consonant that is often found after an "a" in short, phonetically spelled words. Both "t" and "m" work well.
Place the chosen consonant down after each "a" card and be sure to say the sound that this letter makes.
Slide the two cards closer together and say the sounds together. You would say "at" every time you slid the two letters closer together if the letters you were working with were "a" and "t". Often times the child will say the sound with you by the time you are on the third or fourth set.
Model creating a word by choosing one card, such as an "h" and placing it in front of the first "at". Say the sound as you place the card down and then again as you move it closer to the "at". The child may realize that you have made the word "hat" and say it out loud or you may have to say it, until she becomes more comfortable.
Encourage the child to add a different beginning consonant sound to each "at" and form their own words. Allow for silly words as well as really words; the purpose of the activity is to work on phonetics.