Find a standardized word list used for reading assessment. Although there are many excellent resources for this online, you might also ask if your child's school has these materials. It is likely that the school will be able to provide you with the list that it uses for determining reading ability. A list that you receive from a school has a greater likelihood of being accurate than one you find online.
Administer the assessment to the child. Explain that you would like him to read as many words as he can but that it is all right if he doesn't get some of them right. If your child is unwilling to focus on the task, you may encourage him by offering an M&M or small sticker for each word he gets right.
Listen to your child read each of the words. If she gets one word wrong let her continue to see if she can pronounce the next words accurately. When she gets three to five words in a row wrong, or if she becomes frustrated, stop the assessment.
Count from the first word on the list to the last word that your child was able to accurately pronounce. The exact method of scoring will depend on the assessment that you use, but it should give you an idea of your child's reading level. Be aware that certain assessments may have slightly different instructions than the generalized ones provided here.
Determine your child's reading level by considering whether he has reached a certain milestone and comparing it to a standardized time line of reading development.
Decide whether your child has achieved the reading milestones typical of a 5-year-old: At this age, children start to match written and spoken words, understand that writing moves from left to right and can write a few letters or numbers.
Decide whether or not your child has achieved the reading milestones typical of a 6- or 7-year-old: Children at this age start to read familiar stories with only minimal assistance, can sound out words and will correct themselves when they make a mistake while reading.
Decide whether your child has achieved the reading milestones typical of a 7- to 8-year-old: During this phase of development, children begin to read longer books independently, can read aloud with proper expression and are able to spell simple words.
Decide whether your child has achieved the reading milestones typical of a 9- to 13-year-old: Children start to develop the ability to read increasingly complex texts. They become able to identify the major themes of a text, start exploring a variety of reading genres and are able to explain the meaning of what they are reading.
Buy children's books that have a reading level rating on the back. These ratings usually looking something like this: RL 4.1. This example would indicate that the text is written at a reading level typical of a child in her first month of fourth grade. As another example, RL 2.6 would indicate a reading level typical of a student in the sixth month of second grade.
Ask your child to read to you, starting with the books that have the lowest reading level and working your way up to the higher reading levels. Listen to her carefully to see whether she is able to read the majority of the words in each text. Stop when your child becomes frustrated or is no longer able to read many of the words. This step may be completed over a number of days to prevent the child from tiring or losing focus.
Ask your child to summarize the story after completing each text to assess his reading comprehension. If he is unable to accurately explain what happened, the book may be too complex for him.
Consider your child's ability to read and comprehend the text to determine her approximate reading age.