OK, that's out of my system!
Seriously, I think this is a HUGE part of living an abundant and frugal life. I love giving gifts and making people happy, and feeling like I don't have enough to spare to give a nice gift makes me feel so wretched. I think that's why I started making as many gifts as I could. But, make no mistake: it takes time, so plan ahead!
Homemade goodies are great, because they're inexpensive, appreciated, and you can make MULTIPLE gifts at the same time (a huge boon in the holiday season.) Make jam in the summer, and package in small containers for easy holiday gifts. Cookies and candies can be fairly easy to whip up- I think my favorite holiday treat so far to pass out was these pretzel bites. They're so tasty, and my 2-year-old was able to help.
Check out my sidebar for tutorials- crayon rolls, purses, small home items, etc.
Another favorite gift of mine is jewelry- with a few skills (how to open and close jump rings, how to use crimp beads, how to...string beads on wire, string, or pins) you can make an astonishing number of things, for sometimes pennies on the dollar of what you'd pay at the store.
Honestly, the hardest part of jewelry-making so far has been figuring out what materials to use, but you'll get the hang of it pretty quickly after using a few tutorials online and seeing how different pieces behave.
Embroidery is another easy, inexpensive skill to learn, that makes ordinary gifts "special."
What about you? What do you make for your family or friends? Do you think it saves you money?