A great way to save money around the holidays is to make your own decorations. Be careful and do some math, though, because homemade decor is not always cheaper than store-bought. The trick is to make decorations that you already have most of the materials for, or that you can get materials for very cheaply.
I've been really into wreaths this year, so I'm planning to make one or two next week with my girlfriends. I found a lot of cute ideas for wreaths, but the ones I'm planning to make need mostly materials that I already have. (see link below!) I'm going to do a paper wreath, because I already have a lot of odds-and-ends colored papers left over from other projects, and I also have a circle-cutter that came with a button making machine I bought years ago. If you don't already have colored paper and a circle cutter, this project would not be very frugal for you. Perhaps you have a lot of fabric scraps- there is also a cute wreath shown that uses those. I also have a lot of old vintage tinsel that one of my grandmothers gave me a few years ago, that I hadn't figured out how to use. Then I came across a great wreath idea that uses a lot of tinsel on the Creature Comforts blog! So in that case, the only thing I will need to buy is a foam wreath base, which are really cheap, PLUS I will use a coupon at Michael's (see link- thanks to Alena L. for the tip!). The wreaths are usually about $5, but with a 50% off coupon, my total cost for the wreath will be about $2.50. Much cheaper than buying a ready-made wreath! See all the how-to links below the picture.
Paper wreath, fabric scrap wreath, other great wreaths: http://www.creaturecomfortsblog.com/home/2010/11/15/diy-holiday-wreath-roundup.html
Tinsel garland wreath: