With unemployment at 10% as of November, as reports the U.S. Department of Labor, consumers are cutting back on their holiday spending. Households in the United States are expected to spend an average of $390 for gifts this holiday season, down from last year's estimate of $418 and the 2007 estimate of $471, according to The Conference Board.

How can cash-strapped parents get great gifts for their kids without breaking the bank? Here are some ideas for easing the crunch and ways to buy inexpensive gifts that children will love:

Sell toys that your children have outgrown. By selling used toys and using the money to purchase new toys, you'll be offsetting the costs of children's gifts and cleaning out your house as well. Although you may not get top dollar by selling used toys through a consignment shop or at garage sale or on eBay, every little bit will help your budget-shopping efforts.

Shop at consignment shops and charitable thrift shops. Many of these shops have high-quality toys and other great gifts for a fraction of the price you'd pay at a store. For instance, rather than paying $10 to $15 for a new puzzle, you may be able to buy five puzzles for $5 at such shops. When your children tire of the toys or puzzles, you could donate them to the charitable thrift shop (your donation may be tax deductible, so check with your tax adviser) or take them back to the consignment shop for re-selling on consignment.

Organize a gift swap. Every year, many of us receive gifts we can't use or don't like. It's likely that your children—and your friends' children—have some toys they have never used or clothes they have never worn. Rather than let these items collect dust, organize a "gift swap," where everyone brings one gift and leaves with a gift from someone else.

Limit the number of presents. Instead of giving your child several gifts, some of which may go unnoticed, buy one or two special presents. It's a way to give great gifts while limiting spending.

Consider alternative gifts. Taking your child to a special event is a wonderful way to take the emphasis off of "stuff" and to spend quality time with your child, creating a holiday memory for both of you.

Give a gift of personal memories. Discuss different kinds of great gifts with your child, the kind that your child can cherish for years to come. For example, make your child a scrapbook that commemorates the pre-school years, or write your child a letter saying why he or she is so special to you. For many families, such letters are a way to make the holidays more meaningful.

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