Click on ADD A GADGET.
Scroll down the list and click the plus for Label.
Decide how you want your labels to look.
Then save your gadget. You can move where your gadgets are placed by dragging the rectangle where you want it to be and then save your arrangement.
To add a label you write your post and add the label that you want your viewers to see. like this...
Your labels will then look something like this...
At the end of the year you may want to get rid of all the labels that were children's names ready for the next class.
To do that open your post list on the dashboard.
Click in the upper right menu to display all the posts with the same label.
Now select all of those posts by clicking the box at the top of the list. This selects all of the blog posts.
Next to the check box is a Drop Down Label Menu.
Open it and click on the label you wish to remove.
This will remove the label from all of the blog posts it was used with, thus deleting it from the label list!