Consider a Tenkara
I'll probably get blasted for saying this, but consider a Tenkara outfit for a few years. My daughter just turned 8, and has been using one since she turned six. While you can't go out and fish big nymphs and streamers easily, you can us an indicator, etc. Sadie either fishes hers down and across with a beadhead or a wet fly, or uses an indicator and a nympth. She uses a single spey/roll cast much of they time. She also does a snake roll. The casts are the same as a normal fly rod, but there isn't the added complexity of so much line management, the reel, etc. Much more simple.
She is also able to hold it with both hands, which makes a big difference in her ability to not get tired, and the removal of the reel takes several ounces off the weight they have to deal with. They don't need to make supper long casts, they won't have that skill set for some years. She can fish out to about 20-25ft depending on the set up.
Here she is swinging down and across.
She can cast my single handed rods, but she uses two hands for her casts for it is easier.
I will get her something like a Gecko when she is ready for that.
I can point you to someone that carries some nice but reasonably priced tenkaras if you become interested in getting one. You should be able to get a rod and line for less than $100. Sadie's is 25% fiberglass, so it is more durable than many, and is only 11ft long. We also have an 8.5' one. An they are also great for panfish with a pink lightning bug and a pink thingamabober.:chuckle: