Since retail stores are already focusing on Christmas, I thought I’d get an early start too.
It’s really the together time that counts, and small kids like homemade gifts just as much as the store-bought ones. Also you can have them help make cookies to give, they learn how to bake and they get to sample the cookies, and it’s inexpensive.
I have artist uncles. I remember my uncles would make me and my brother cool handmade gifts. One time I got a puzzle made out of a board with a picture of Mary and baby Jesus glued to the top, cut into weird shapes with a jigsaw (a true jigsaw puzzle!). Another Christmas one of them made paper-mache ornaments. One looked like King Tut's sarcophagus. We thought these were the coolest ornaments ever and would fight over who would get to put King Tut on the tree.
At one time, I was living in a communal hippie household. My housemate’s kids were small and I made a fort out of a big cardboard box for them. They played with it a lot more than with their regular presents, which unfortunately sort of irked my housemate, but oh well, she was always complaining. You can’t go wrong with a big cardboard fort for small kids.
http://www.stretcher.com/stories/10/10nov08e.cfm This mother of 5 decided to hit all the free holiday events in town, and made homemade gifts, which her eldest helped with. They visited relatives and instead of exchanging gifts, spent time doing fun things. For her husband, she wrote a love letter, which is an annual thing with them. That is so romantic.
So, with a little creativity you can have a holiday season that captures the spirit of Christmas instead of the expense of stupid commercialism.