Earlier, I wrote about how I minimize mishloach manot.
I'll admit, the first year I only made a few gift packages it felt very strange, and I was even a little sad. But, I realized, it is so nice to know that there is less work to do, and more tzedakah being given, so in the end, I've gotten used to it and decided it's a good thing.
There are still two more things that tend to cost a lot of money Purim-time: costumes (a minhag/custom), and a Seudat Purim (one of the mitzvot of the day).
I must admit, I was far from frugal this year when we figured out costumes for the kids... You see, since the Jewish Year began, I have spent about 2.5 months not exactly functioning. I got sick twice (once with the flu), and both times I ended up with long, drawn out, awful asthma spirals. Both times I took tons of medication (including steroids) and about a month to get back to breathing... So I've been feeling like I just cannot stay on top of things. And when my kids started asking about shopping for ready-made costume "stuff", I agreed, as I figured if I spent less time with sewing and designing and all that, we might actually be able to catch up on some of the other areas where we've fallen behind. So I spent about 150 shekels altogether on costume supplies.
Of course, for me, this was time-frugal, even though it wasn't shekel-frugal. Everyone needs to make that call for him/herself. If you are set on making your own costumes, there are so many DIY ideas out there. There are even some great "no-sew" costumes, that you can easily find if you search (and I've definitely done that in the past!).
The other thing to think about is the Seudah, the Purim meal.
This can be elaborate and fancy. Some people I know serve 4 course meals. And have lots of wine and other alcoholic drinks available, as well, as somehow this seems to be a Purim thing for many people.
HOWEVER, I am not a fan of using Jewish ritual as an excuse to get drunk, so I don't advocate having an "open bar" at your seudah. It will save you a lot of money and probably a lot of emotional distress as well. We bought a few bottles of Smirnoff Ice when they were Buy one Get one free at Yeinot Bitan, so we'll chill a couple for the adults at our table. That will do it for us.
As far as the food goes -- it's totally up to you! There is no real requirement except that you must wash netilat yadayim and make hamotzi on some bread, and have a meal - it should start before the sun sets, so it is still Purim! It can be meat, dairy, vegetarian - whatever you like. We are having a quiet family seudah this year (for a number of reasons), and we plan to have a simple meal, but perhaps a step above our norm. We'll have some homemade foccacia (a treat for us - I normally make healthy whole wheat sandwich breads!), a lasagna, macaroni and cheese for picky children, and some salad. The lasagna noodles are an "extravagance", as I don't usually buy them! (But we got some when they were on sale, of course, for about half price, or less. We paid 7 shekels/box.)
Dessert will be hamantashen, of course!
And that, my friends, is how we are having a festive meal without spending a lot of money. We chose not to go to our community's communal seudah (again, for a number of personal reasons), but if we had gone it would have cost us a lot of money (seems like 170 shekels, which for a meal "out" is not so terrible for a family of 6, but for us, a meal out WITH the kids and whole lot of people who may or may not get drunk -- I'll stop there), but for some people a communal seudah may be very worthwhile. Ideally, we would have another family or two over to join us for the seudah, but it wasn't possible this year, because of some logistics we could not work around. Sometimes it IS good to just have a family celebration though. This way our kids are getting 100% of our attention, and that is great. We'll make sure they all feel the Purim joy and celebrate the miracle of the day.
I'd love to hear how you plan to celebrate Purim!