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Lyn,
my daughters are 10 and 7 and we have had a similar experience... i think
yours is a great question. i think at an earlier age my 10yo had a better
handle on it but as she has become exposed more and more to other
school-at-home homeschoolers she sees the contrast... she would be more
comfortable to complain to them (along with them) "i have to do such and
such" or "my mom makes me do ____" etc. --shared complaining seems to be
part of building the friendship! since she doesnt have much to go on that
route, it moves to the chore requirements, junkfood rules, computer
restrictions, etc. i'm not saying this is a big part of the relationship,
just that the kids are learning about other households by sharing their
stories, and of course at this age, out-doing the last story is part of the
fun.

to try to answer your question, you may first realize that it is your problem
and share it with her that way. (if you really are uncomfortable w/her
current answer.) like how you mentioned to her that people dont always
understand, so how bout we use this answer when people ask (if you can find a
suitable answer.) for eg., i have a friend who had named their school so
that when people at the grocery store asked what school they went to they
would just say, "oak tree academy" or whatever and the conversation would
end. rather than saying "oh, we homeschool" and be willing to go where that
takes you.

it is a personal thing! i would rather (most days) invite the homeschooling
conversation, but i definitely could see that there is sometimes reason NOT
to invite it.

i would tend to want to follow up on a comment like "i dont see how it works,
either" from my daughter! just because it would make me feel better to
convince her that she does really know that she is learning and progressing
beautifully! i would want her to have that confidence. but maybe this isnt
what she meant. i can understand this bugging you, though. did you just let
it lie when she said that?

erin