What is the best way to explain grace to a child ?
Grace is unmerited favor. I would explain something like. Your child didn't do anything to gain your love and can't do anything to lose it. You love them because of your grace, not because they did something to earn it.
Grace of God is God's love and it never stops, and always listens, and always gives you a chance to be better.
Teach the child by showing grace through your own actions
Just go from the song, Amazing grace how sweet the sound that say, etc
Grace is a gift from God that helps us get through tough times and helps us be better people.