My daughter just turned five, and when people asked me what they should get her, I said books and art supplies. She loves reading and anything artsy, and they're both things that don't take up a lot of room or are consumable. She got SO many art supplies (watercolors, make-your-own fingerpuppets, beading stuff, colored pencils, sticker books, paper, coloring books, etc.) and lots of books. We're set for another year!
For goodie bags, I bought cheap $2 watercolor sets and a few really cheap plastic rings or hair things and decorative pencils. Her party theme was rainbows so I bought everything in bright rainbow colors.
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