My three-year-old niece is always making up these stories of what happened during her day, or week. When you ask her a question, she tells the truth, it's when she runs out of fun stuff to tell me that she makes up these stories. My brother is getting nervous that she is turning into a liar. But I just think she is being creative. What do you think?
She is not "turning into a liar." She enjoys your attention and responses to stories of her day and week and when she has exhausted her "real" tales she chooses to make up additional stories rather than end this special time together. Kids at this age and stage also blur their worlds of reality and fantasy. I would consider it appropriate for you to continue appreciating her "life stories," while telling her that you also enjoy her imaginary stories. Once you give her permission to be creative in telling "pretend stories" to you, she can continue to tell you both real and imaginary stories with equal enthusiasm.
Don't be surprised, however, if she occasionally claims that her pretend tales are real. Sometimes, it's just too irresistible for a three year-old not to exaggerate. You and her dad might play along and tell a few real and pretend stories to her, asking her which ones are real and which ones are imaginary. Enjoy this creative, engaging little girl.