As you think about signing kids up for organized sports, consider how emotionally and physically ready they are to participate. If they're too young or not ready, it will be frustrating for everyone, and can turn kids off from sports for good.
Although there are sports programs designed for preschoolers, it's not until about age 6 or 7 that most kids develop the physical skills and attention span that most sports need. Preschoolers can throw and run, but it usually takes some time before they can coordinate the two skills. And it may not be until kindergarten or first grade before kids understand the rules of the game.
That doesn't mean kids can't play sports when they're younger. Sports can be fun for toddlers and kindergartners, but these should be less about competition and more about learning skills and having fun while being active. So even if young kids inadvertently score a goal for the other team or spend the entire game chasing butterflies, as long as they're enjoying it, that's OK. If you do decide to sign your 5-year-old up for a team, be sure to choose a league that emphasizes fun and basic skills.