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We went with a twin because we needed the crib for LO2. Our twin is long, so he could probably sleep in it until he leaves home. I feel like a toddler bed is a waste of money since they are so short. We went for a twin out of space concerns, both of our LOs have relatively small bedrooms.

@Bao: that's good then! I've seen beds marketed as toddler beds (not converted from a crib) and I just don't get the appeal.

Straight to bed

We did a toddler bed. We liked that ours was lower to the ground than a twin and saves her some space for playing in her room. We have this one: http://www.amazon.com/KidKraft-86921-Modern-Toddler-Bed/dp/B001772QYI

We moved her from her crib to a full sized mattress on the floor. We love the space we have if she needs us to lay beside her and we didn't want to transition the bed because we knew we were having another LO soon after she switched anyway. She loves it and we didn't pay too much, we actually just bought one off the floor at a furniture store so it was discounted.

We transitioned her crib to toddler bed for like 2 months but she would be sleep terribly. It was too easy to climb out. After two months, we moved and transitioned to a new room and a full sized bed. I don't know if she was just older, but it went much more smoothly and she sleeps fine. I did not get a rail (I'm cheap) but we stuffed both sides with pool noodles and extra pillows so she didn't have a problem. She's also not a big mover when she sleeps.

@Bao: We are not going to make the transition until absolutely necessary. I figure... if he's sleeping well in the crib, why mess with a good thing. Depending on how long he lasts, we'll see what size makes sense.

We plan to go straight to a twin bed when that time comes.

We went the toddler bed route and our reasoning was this: our crib was super expensive so we handed that down to DS2. We definitely weren't going to buy another crib if we didn't have to. So even though it converted, it was cheaper to buy a toddler bed rather than another crib. Then, the choice was toddler bed vs big bed. The toddler bed was $100, but we signed up for an amazon card, which had a cash back for signing up for the cc. The bed ended up costing $30, and we reused his mattress (bought new mattress for new baby), and could reuse his crib sheets on a toddler bed. Even though we will only get another year or so of use out of it, it saved us enough money that we needed to spend on the new baby.