Oh I think most posters would agree with you that ANY amount should be accepted gracefully and gratefully (I know i do). I think the reason many pointed out that there is a lot you could get for $25 (it is the reason I did) is, per the OP, the obnoxious sister actually has the OP second guessing the amount and wondering i you really cannot get much or that (see bolded below).For all of you that are saying $25 is plenty and there are tons of things they could buy for that amount, I think you are missing the point. It doesn't matter if the OP sent those kids $25 or $5. The OP took time to come up with something for these kids and gave an amount she was comfortable with giving. If it had only been $5, so be it. It truly is the thought that counts and this point went right over the SIL head.
Honestly, you are a better person than me because I would respond and it would not be pretty. The amount you gave is irrelevant. The rudeness is what I find unacceptable.
Little background, DF was laid off in April right as I finished school. We relocated here for a job for me, and he recently started working. So we basically had no income for 6 months and had to live off savings and then credit cards and we are now paying both rent and a mortgage. Financially we are not in a great place right now but we are getting by, which we are greatful for. Darling SIL sent me an email today regarding the gifts we sent for Christmas to her kids. I just want to pull my hair out. We sent each child a $25 gift card to Toys R Us so they could choose their own toy. This sis complains each year no matter what we get her kids, but here is a bit of the email I got from her this am. I am really hurt & offended. Is $25 not enough? I dont even know how to respond, I dont think I am going to. What is the going rate for a gift card for a child that is under 8?
Quote from the email:
I wanted to thank you for the gift cards, but just wanted to let you know since you do not have any children you must be unaware that $25 is really not enough for a toy. Thank you for thinking of us, it really is the though that counts. They will be able to save them and put them toward something, we will cover the rest. Merry Christmas.

We're a small group in my family that's not crazy. We tend to stick together and ignore the rest. 
That would be the last gift of any sort I would be sending to that household.
Hold on there a minute, not everyone agrees. I think SIL has a point as OP clearly did not put enough thought into what is clearly the perfect gift for these children. See my previous post, because I think the answer is quite obvious.
OP, I'm very relieved you still have a good amount of time before Christmas to correct your gaffe!

I totally agree.
I would actually respond and ask for the gift cards back.
"Dear SIL,
I'm sorry that I underspent. If you will return the gift cards to me, I'll give it another try and send something more appropriate. There's still plenty of time before Christmas Eve. Thanks!"
If she actually does send them back, go to Toys R Us and spend them on toys for Toys for Tots (you can get a lot for $25). Make a list of all the toys you were able to purchase for children who would, otherwise, not have a Christmas and send it, with some home-baked cookies or handmade something, to the kids with a note that says:
"I got a note from your mom earlier this month and it helped me see that this year, with money so tight around the country, it would be most meaningful to make my holiday gifts for family and friends and to donate the money I normally would have spent to help provide gifts for kids in the community who would otherwise have nothing to open on Christmas morning. I have, therefore, donated $25 to Toys for Tots in each of your names. I hope you enjoy the homemade gifts I've sent as well as the priceless joy that your donation will give a needy child. Merry Christmas!"
I don't think a gesture like this punishes the kids, particularly if you send it along with something inexpensive that you've made that speaks directly to each kids' interests. Besides ... they're under 8. They won't be scarred for life. And -- if there are still Christmas miracles out there -- maybe your SIL will finally "get it". Not only will she see how much you can actually get for $25, but she will be trumped in the "Christmas spirit" department. She may never admit it, but she'll know.
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Little background, DF was laid off in April right as I finished school. We relocated here for a job for me, and he recently started working. So we basically had no income for 6 months and had to live off savings and then credit cards and we are now paying both rent and a mortgage. Financially we are not in a great place right now but we are getting by, which we are greatful for. Darling SIL sent me an email today regarding the gifts we sent for Christmas to her kids. I just want to pull my hair out. We sent each child a $25 gift card to Toys R Us so they could choose their own toy. This sis complains each year no matter what we get her kids, but here is a bit of the email I got from her this am. I am really hurt & offended. Is $25 not enough? I dont even know how to respond, I dont think I am going to. What is the going rate for a gift card for a child that is under 8?
Quote from the email:
I wanted to thank you for the gift cards, but just wanted to let you know since you do not have any children you must be unaware that $25 is really not enough for a toy. Thank you for thinking of us, it really is the though that counts. They will be able to save them and put them toward something, we will cover the rest. Merry Christmas.
We also have a $25 limit on the adult gift exchange. I've never had a problem finding something nice and heartfelt for that.I totally agree.
I would actually respond and ask for the gift cards back.
"Dear SIL,
I'm sorry that I underspent. If you will return the gift cards to me, I'll give it another try and send something more appropriate. There's still plenty of time before Christmas Eve. Thanks!"
If she actually does send them back, go to Toys R Us and spend them on toys for Toys for Tots (you can get a lot for $25). Make a list of all the toys you were able to purchase for children who would, otherwise, not have a Christmas and send it, with some home-baked cookies or handmade something, to the kids with a note that says:
"I got a note from your mom earlier this month and it helped me see that this year, with money so tight around the country, it would be most meaningful to make my holiday gifts for family and friends and to donate the money I normally would have spent to help provide gifts for kids in the community who would otherwise have nothing to open on Christmas morning. I have, therefore, donated $25 to Toys for Tots in each of your names. I hope you enjoy the homemade gifts I've sent as well as the priceless joy that your donation will give a needy child. Merry Christmas!"
I don't think a gesture like this punishes the kids, particularly if you send it along with something inexpensive that you've made that speaks directly to each kids' interests. Besides ... they're under 8. They won't be scarred for life. And -- if there are still Christmas miracles out there -- maybe your SIL will finally "get it". Not only will she see how much you can actually get for $25, but she will be trumped in the "Christmas spirit" department. She may never admit it, but she'll know.
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