New to Knitting

A friend gave Mickey a knitting kit for her birthday. The kit knits up a scarf and hat. She is quite taken with it. I have her sit between my legs, while she works the needs and I work the yarn. As she progressed I was able to move my hands to the end of the needles to prevent stitches from falling off. I think she'll soon be able to knit all on her own. The biggest hurdle is figuring out how to hang onto the yarn and needle at the same time. Any suggestions?