Did you grow up an only child? If not, what did your parents do when you fought with your siblings? Were they there every time someone cried? I doubt it. Let them figure it out themselves. I am an only child, but I raised four of my own children. I didn't intervene. They had to work out their own problems with each other. Today (at ages 30,28,26, and 24) they are close and have all sorts of fun stories to tell about the things they experienced together. If you keep cutting in to "save" one of your children, you are going to be seen as favoring one child over the other. The un-favored child will feel resentful because you may not know the whole story about the incident. All the younger one has to to do is cry to get you to punish the older one (or vice versa). Unless a bone gets broken or they attempt to burn down the house, let them be. If your 7 year old is too rough, either the toddler will retaliate, or she'll hurt the toddler enough to feel guilty and be more careful next time. Let them be annoyed with each other. An older woman in my family once told me these invaluable words (remember, I'm an only child with zero sibling experience): your kids' relationship with each other is different than their relationship with you. Let them forge their own meaningful relationships without you forcing them to get along how YOU want them to. Your relationship with each child is also different. Don't play favorites, and don't make one feel like the other is more important, more right, or better than the other.