I just started my daughter in it. She is kindergarten, but I signed her up for 1st grade so that we would have access to k, 1, and 2. She is loving it, and really learning a lot!!! I think we are liking it more than Reading Eggs
You definitely need to supplement with "real" books and hands on activities.
I'm going to do time4learning along with FIAR and this for K:
Are you Growing a Reader? Homeschooling your early reader? No need to buy an expensive curriculum to get your child off to a great start at reading. Do you want to avoid tedious, boring worksheets and instead learn through engaging hands on activities and play? Here are a collection of links on teaching your child to read and write for free: Sight Words or Phonics? How about a balanced approach?
Read some background on using a balanced literacy approach to teach your child to read. What does your Kindergartner need to learn in reading? See the list of Common Core Kindergarten Standards and links to activities to teach those skills to your emergent reader.
The short answer: nothing. You can do all of the lessons and activities here using books from the library and things you already have around the house like paper, pens, chalk, and index cards. In this post I suggest some possible things you can buy to enhance the activities. These are supplies that you will be able to use for years, not just for a couple of lessons. Manipulatives like a good set of magnetic letters can be used from preschool into elementary school, beginning with basic letter identification, on to phonics, building sight words, word families and complex multisyllabic spelling words.
Read, read, read to your child. Reading aloud to your child is the best thing you can do to grow a reader. Go beyond reading aloud and teach your child reading skills while enjoying great literature! (Preschool, Pre-K, Kindergarten)
Your child can learn more phonics "rules" by learning several words with common letter patterns. When your child learns to make analogies and manipulate onset and rime they can quickly read and write hundreds of new words. These are better known as word families. (Kindergarten, First Grade, Second Grade)