We were a family of seven growing up and we were always broke; so during the holidays we always made things for our relatives. Some idea's I remember are:
Pot-Pourrit Baskets: get a bunch of shallow baskets without handles (breadbasket style) and check a dollar or discount store for a few bags of pot-pourrit. Also pick up the same amount of glass candle holders (the cup kind) as you have baskets, and a nice candle (the two inch high kind) to put into the cups. Get something to trim the baskets with (lace; or ribbon, or nature's decorations). Use a glue gun (you can get those at dollar stores too) and glue the glass cups to the baskets; then glue a candle into the holder to keep it in place. Then glue your trimmings to the rim of the basket. Fill around the candle holder with pot-pourrit. Done and done. Great project for kids as long as you're doing the gluing.
Picture Frames: this is pretty self-explanitory; just let your kids go imagination-crazy and then take a family photo and voila, you can give a nice gift to your family/friends that the kids put their "blood sweat and tears" into.
Stage/Age Photo: When my ex and I split, I still wanted to do something nice for my son to give him for father's day; but I was broke. This idea could be used for Christmas too. I went to the dollar store, bought a canvas, some white glue, some red paint finger paint and some red glitter. It all came to about $6 or $7 CDN. Then I sat with my then 1.5 yo and we practiced doing handprints on newspaper (he kept curling his fingers). Then, when he got it, I stamped his handprint onto the canvas. Then I stamped his footprint next to it and used a brush to write "Happy Father's Day" and put the date. After it dried (next day...?) I lined the edges with squiggle lines of glue and then glittered the glue and let it all dry. It was a very unique "remember how little I was!" gift....the SOB returned the favor by dragging me to court today
: (that's another subject for another day though) I also did one for my OWN father, very similar except in place of baby's footprint was my handprint. My dad returned the favor by framing my work by hand and putting it up.
Drawing cards: two years ago, when my boy was starting to color on paper, I gave him a notebook and some crayons and he made lines all over every sheet. I took those sheets and one by one turned them into cards for family members and close friends. I included the date on them to mark his first drawings.
I have TONS more idea's; but I havn't slept in a long time, and my brain is dead
I'll try again another day. Good luck!