This is what we do.
We stress memorizing Scripture, because 1) There is no better way to hear from God and know Him than to KNOW His word; and 2) Hiding God's Word in your heart means that it is always there to help you. The children's pastor cannot be with kids 24/7. Parents cannot be with their kids 24/7. But the Word of God can be with them all the time if it is in their heart, and God can speak to them through His word.
We encourage kids to memorize 2 verses a month. We do a 2 year rotation, so that by the end of one year, kids will know 24 verses. By the end of two years, kids will know 48 verses! That is more than a lot of adults! Then, we repeat them.
Here are some tips for helping kids hide God's Word in their heart.
1. Repetition is one of the key ingredients for helping kids memorize verses and REALLY remember them in their long-term memory, hiding them in their heart. That is why we repeat those 2 memory verses over and over. They hear them in their Sunday School classes. They hear them in kids' church. They sing them in songs. They hear them on Wednesday nights and in their small group time. Then we give them memory verse magnets to take home and hang on their fridge, so they can see them every day.
2. Short, simple and relevant
We use verses that are short (some of them are longer than others!) and easy for kids to understand. We use verses that mean something to them, and can help them in their daily lives (Such as: Joshua 1:9 "Be strong and courageous. Do not be afraid, for God is with you."). We normally use the NIV and NLT versions, but sometimes we use another version if there is a more kid-friendly way of wording a certain verse. I do not believe there is anything more holy or special about the King James Version. Kids should learn the Word in a way that makes sense to them.
3. Make it applicable
We help kids understand not just what the verse SAYS, but what it MEANS and how God can use it to speak to them or help them, or teach them about Himself. We teach them to say the verse in their own words, and use the verse to help them throughout the week.
Here is a list of all of our memory verses for 2012 and the first half of 2013. To download this list, click here. We have songs that go with about half of these verses, and that is an excellent way to help kids memorize Scripture! They love singing the songs with the verses!
At the end of each month, we have a Scripture Memory Challenge, where we encourage the kids to say both verses in their entirety (without looking) to a leader, in order to get a prize! We have a lot of kids who do this, and it is awesome to see them loving the Word and getting excited about memorizing it!