Here are some ideas that a general internet search has brought to me. Some of these ideas I can use right away this year. Others will be archived for future years' use.
1. Write a Christmas letter. You can make it look like a newsletter, or a vintage letter. However you you decide, you can update your extended family on the big news of the year in your family. There is even somewhere to send your addressed letters, that will ensure that the postmark will be from the North Pole! How cool is that?
The North Pole, Alaska post office will stamp all of your envelopes with their special holiday cancellation for no additional charge (you still need to put regular postage on your envelopes). All you have to do is adress and stamp your envelopes as you normally would. Then stick them all in a larger envelope and send them to:
North Pole Christmas Cancellation
5400 Mail Trail
Fairbanks, AK 99709-9999
The North Pole elves (ok, postal employees) will then make sure your letters get sent to the appropriate addresses, just as if you'd dropped them at your local post office. To ensure delivery in time for Christmas, be sure to get your letters to the North Pole by December 15 at the very latest.
2. Make a wreath out of construction paper cut outs of your childrens hands. Let them pick colours, or have younger ones colour the hands. Cut a piece of cardboard into a ring the size you think you may use. Glue the paper hands to the ring, and attach a bow.
3. Refrigerator magnet that grows! Use a clean, transparent old prescription bottle. Attach a piece of magnetic to the back with glue. Add a small amount of soil, and a fast sprouting seed (think bean).
4. Write a children's story with your family members names as the characters. You can make up a fictional story or retell a favourite family event. You could hand print the story in a plain journal book. You could add photos, draw pictures or even use images cut from magazines to add the pictures to your story.
5. Make a button wreath ornament, or use buttons to make christmas themed ornaments.
6. Cookies in the shape of your childrens hands. Use some sturdy paper to trace your kids hands, cut out and use as a template for your cookies. use a sugar cookie recipe for the cookies.
7. Create a secret hollow book for someone. Find an old thick hardcover volume with an attractive title from the thrift shop. Glue the pages together and to the back cover but not to the front cover. Use an exacto knife to hollow out the pages, leaving at least half an inch of paper on all four sides. Put a handwritten message inside for the recipient.
8. Buy a photo frame from a thrift store and decorate it. Put a pic inside of your family, or your kids. Wrap and give.
9. Get small glass jars from the thrift store. Be sure to clean them completely. Fill with homemade spice mixes like taco seasonings or seasoning salt. Tie an attractive bow to the jar, or decorate another way. Be sure to label the jar with its contents.
10. Give a family tree photo album to a child. Find and reprint pictures of all the people in your family. Go as far as you can (or want to) in the family. Print the name of each person and their relationship to your child, (ie. aunt, cousin, great-grandfather) to put in the sleeve with each photo. You can get good used and sometimes new photo albums from a thrift store.
These are just a few of the great ideas I have found, or have come up with on my own. Frugal and unique, just like the gift giver. Please comment with some of your ideas below.