Ever since Vivi learned that there was a baby in mommy's tummy, we've been helping her understand the different relationships in our families. She knows, and proudly announces, that she is going to be a big sister but the fact that she may have a sister or a brother is a little harder to grasp. (That's why this baby will probably forever be known as "Turtle.")
Vivi is aware of who her grandparents are and who goes by aunt or uncle but the fact that Katie is my sister thus making her Vivi's aunt, well... I think it'll be awhile before she has a handle on that. She seems to be processing it though.
We recently discovered that Vivi has renamed many of her stuffed animals. A teddy bear that used to be known as "Big Ted" is now "my big sister" and her little stuffed frog is a "little cousin." It's not stopping there though.
As we were putting Vivi to bed a few nights ago, she told us to be quiet because someone was sleeping in her big girl bed. I looked and there was no one alive (or even stuffed) there-- just her blanket and pillow. When I asked Vivi who was sleeping in her bed, she said "Shhh... my granddaughter sleeping dare." Apparently even the imaginary friends are now related to us.