I am regularly asked this question by aunts, uncles, godparents and even grandparents. A quick whizz around the internet shows it is a contentious subject with no clear answers.
So, it probably won't surprise you much when I say that the amount you should spend on a child's birthday gift... depends.
But that doesn't really help you, does it?
To try and give you an answer that will actually help, last week I asked 500 people in the UK what they spent on the last birthday gift they bought for a baby or child up to 5 years old.
The average gift spend in the UK is £37.50.
This varies quite a lot by age, while 25 - 34 year olds spend the most, at £49.50 on average, over 65s spend just £26.
Are you surprised?
The easiest way to decide how much you should actually spend yourself, though, is to ask yourself these two simple questions:
Let's face it, nobody is going to expect you to bankrupt yourself or go hungry to buy their child a fancy birthday gift (and if they are, why on earth are you buying them anything at all?!).
There are loads of inexpensive options that will go down well with babies or small children - they certainly won't notice the price tag when they're ripping off the paper!
If you're feeling a bit strapped for cash, spending £5 - 10 on a small fun gift, such as a book or toy, will be appreciated. And you never know - in our experience, it's often the least 'special' toy that turns out to be the favourite!
Whilst the age of the child and their interests and personality are important when picking out a gift, when I ask who is the gift for? I mean who are you buying the gift for in relation to you?
Just like when you buy a gift for a wedding, the amount you should spend really depends on how close you are to the recipient.
As a close Auntie (I like to think favourite) I always put a lot of thought into the gifts that I buy for my nieces and nephews. Knowing them well and spending time with them regularly means that I usually have a pretty good idea of what will go down well. This means you can sometimes spend a lot less whilst getting a gift that the child really wants.
This hasn't always been the case, though. When I first became an auntie, and lived in a different country from my brother and his family, I had no clue where to even begin with gifts. I will admit I made some pretty expensive mistakes.
A rule of thumb I usually use when I'm buying gifts for children in my close family, is to spend around two thirds what you would for the adults.
For close family friends and Godchildren, the same rule of thumb applies.
Think about how much you would spend on your friend and spend around two thirds as much on the child.
Even when you've figured out a budget, it can be daunting trying to work out what to buy, but something personalised can be a lovely gift to receive.
Alternatively, picking a present that is age appropriate can help to ensure that your gift gets used and doesn't end up at the back of a cupboard straight away.
If you don't have kids of a similar age yourself, and have no clue where to start, take a look at our gift guides:
Following our two thirds rule, you should spend less on presents for the child of a colleague or less close acquaintance.
Spending too much can be as much of a problem as not spending enough. We've all had those moments where you exchange gifts with a friend and realise you have spent a lot less (or more) than them. The same goes for their children.
Tip: inexpensive gifts that usually go down well include books, colouring in sets and balloon-themed gifts (almost all kids love balloons!).
Of course, if money is no object you could copy one of these celebrity examples:
As a first birthday gift, Kris Jenner (of the Kardashians) bought her niece Luna two cars: one Minnie Mouse themed and the other a roofless pink Cadillac escalade.
When Beyoncé was pregnant with her first child, her old bandmate Kelly Rowland bought her a $5,000 crystal encrusted baby bath tub.
To celebrate Prince George's birth, designer Theo Fennell was commissioned by Sudocrem (the nappy rash cream brand), to design a jewel-encrusted, 18ct white gold charm bracelet (which doubles as a nappy rash cream holder). It's worth £10,000!
"This is my Knitting Auntie."
That's how my eight year old nephew proudly introduced me to his friends recently. He's almost right. I'm his Great Auntie and knitting is my superpower.
Here are 20 facts you might not know about us (Beth and Sorcha)!