When children stop believing in Santa is variable, and depends much on the way the myths of Santa Claus are presented (if they are in fact presented) in the home. Some children are told the basics of the myth, that Santa is real, comes to their homes on Christmas night, rewards good behavior and punishes bad, and has many magical attributes. When this is the primary teaching, many children stop believing in the story at around the age of eight, though this can vary. As children begin to acquire a certain amount of logic and reasoning skills, they may figure it out on their own or begin to question the existence of Santa when they see presents in the closet before Christmas, or note that all gifts are addressed in Mom or Dad’s handwriting.
Peer relationships also cause speculation, since children will encounter other kids who don’t believe or who have already been told the “truth.” Some children stop believing in Santa when assured by another child he doesn’t exist. Alternately, they may notice Santa is not universal as they acquire friends who don’t celebrate Christmas. Children might also note the disparity between the gifts they receive and those received by friends with parents that have different budgets.
When some children stop believing in Santa, they may feel betrayed, angry or lied to by their parents. It matters very much how parents have presented Santa. There are many opinions on the merits or the disadvantages of deliberately involving kids in a myth that their parents know not to be true. Some parents hedge and represent Santa as the spirit of giving, so that all giving has a little bit of Santa in it. Usually, when children stop thinking of Santa as a physical being, or if they never have believed in him in this way, figuring out that he isn't "real" doesn’t hit as hard. Other children, who really have a concrete image in their mind, are absolutely devastated when this belief is taken from them, and yet others feel smart they figured it out.
Naturally, parents want to avoid causing unnecessary pain when children stop believing in Santa, so the presentation of Santa is important. This may run contrary to the many Christmas movies and cartoons that assert and reassert Santa’s existence, so parents have to weigh carefully which of these to allow, and what discussions could take place around this issue. It’s also a good idea to be somewhat noncommittal on the issue, instead of committing to a full lie. Allow kids to tell you what they believe, and let them believe as long as they’d like. As they age, and usually before they hit their preteens, they may have figured out Santa as it best works for them. Parents might tell them everybody needs to decide personally what and how to believe.
There are some children and adults who never stop believing, especially when they view Santa as the spirit of Christmas and an extension of Christ. People with this view get to be Santa, and contribute to the mythos of Santa through their kind and generous actions. When children express disillusion in the myth, parents might consider teaching them how to play Santa and be Santa in their own generous actions. Parents can enlist them in charitable work, like picking out or distributing toys to kids who are impoverished, and share with them the joy of getting to act like Santa during the holidays and throughout the year.