This is so easy and people really like it. Take a picture of the child making sure there is nice background. Send the picture to the photo developer of your choice and get prints wallet size.
Get adhesive magnet sheet at craft store and cut and attach to each picture. Done! You have made a nice and unforgetable favor.
If you would like a message or name on your picture like the sample above you could use a program like photoshop or Pixlr .