Hama Beads and little plastic cylindrical beads. They come in different sizes for different ages. My son is now three and just old enough to use the mini ones.
We bought a starter pack to get us going. It included a large pack of beads in a variety of bold colours and several pin boards which you build your creations on.
Use the pin boards to place the hama beads on. Young children will have fun choosing colours and making their own patterns. As they get older they can create pictures and more defined patterns. A quick search on the internet will bring up hundreds of different templates to follow if you're looking for some inspiration.
Once your design is complete, an adult places a piece of Hama paper over the beads and irons gently until the beads melt together. You leave it to cool for a few minutes and then your creation is ready.
I'm really taken with these little Hama beads and my son is enjoying them too. He had a group of his friends to play recently and it was one of the first times I've seen them all quietly concentrating while playing with these beads. They're usually tearing about my house making a mess!
For a three year old, making a Hama bead coaster is the easiest project to start with.
Some of the educational benefits include developing fine motor skills, colour recognition and developing patterns.