For my daughters 9th birthday she gave me a gift. She wanted a party that ended up costing .50 in gas and $1.92 in cupcakes. How did this happen? Well, have you ever heard of Home Depot's Kid's Workshops that they have every few Saturdays?
Home Depot also offers their Kid's Workshops to parents as a Birthday Party and it is completely free! They set up the table have people there to help the kids build a variety of things. (Bird house, Racing car, Fire truck, Tool box or a Plane.) You can have as few as two kids all the way up to 350! And as Home Depot put it "You can bring anyone from one to two hundred and one years old, everyone is welcome"
The kids each get a Home Depot apron with their name on it, a pin of the item they made, and then get to take the item home with them to show off to friends and family.
So if you are looking for an inexpensive Birthday party for your kids that they and their friends will be talking about for a long time, then give Home Depot a call. I can also tell you as a parent, I had fun watching and helping the kids build things also. The smiles were well worth it.