Your sweetheart now understands phonetics very well and she knows which word sounds silimar. The time is not far when you will get to see a lot of invented spellings even for the easiest words in her notebook.
What you need to know:
You need to correct her for the mistakes she is making. Though, she is coming up with something really creative, make sure you appreciate her presence of mind first and then point out her mistake subtly. Teach her different words that sound similar but are used for different spellings. You might enjoy her writing ‘cap’ as ‘kap’, but it is not going to work in the long run.