Children that age are very immediate. They also are incapable of mortal sin, so bringing up the possibility of Hell is premature. It is better, IMHO, to teach them that relationships are not just about how you feel about someone, but are knit by how you treat them and the ways of being that you share. I remember one little boy, for instance, who answered someone who wanted to know if he was telling the truth with this standard: Our family does not lie, and when we make mistakes, we admit them.
I’d teach them that doing good and avoiding sin are ways we love Jesus, that love is not just a feeling but in how we act. They can understand here-and-now relationships. Stress that sin takes you away from Jesus in the here-and-now, while pleasing God in how you act naturally brings you closer to God and to everyone else–and loving them is very important to God, so it needs to be important to all who love him, too!–because it makes you more like him. I would also teach them that when they wrong someone that they ought to ask for forgiveness and to try to make amends for what they did. This is a good habit–that is, to show contrition not by extracting payment out of those we forgive in a tit-for-tat sort of way, but for the forgiven person to want to do extra good and be more merciful to others as a way of showing appreciation for having been forgiven.
Talking about Hell can wait until they are better at risk assessment and more able to understand what a serious sin is. Keep them innocent of what those serious sins are, for the time being. Give them good habits in how they look at doing good and dealing with failures to love, instead. Teach them to look at sins as something that they put between themselves and God, not as rules that God will whack them for when they cross the line. More to the point, enforce your own rules as God does. Make them natural rules with good reasons and natural consequences, enforced firmly but without giving the child that the idea is for them to either toe the line or get whacked. The idea, instead, is for them to develop the habit of thinking of others before themselves and taking care of their relationships and responsibilities, to be someone who can be counted on to act in a loving way.
I suppose I mean that they ought to develop a desire to become saints first, and then to learn that a proportionate fear of damnation is required later. That is a better order for the innocent to take.
(The only thing the former does is to keep them up at night, IMHO. I’d rather sleep than deal with nightmares.)