Just curious. What do you do at the last lesson when you know the student isn't coming back? Do you do anything special? Sometimes if it's a family or if my kids are available we'll play "Music Bingo" and I hand out music related prizes after they have played their lessons for me.

This is sort of an impossible question to answer as it's probably something that you should be qualified to decide on your own, at least because the reason for a student leaving can be extremely varied and what to do on the last lesson depends on your experience with 'that' student.

I suppose the gift thing is fine, depending on the rapport you've built with the student, age of the student, and length of classes. I've never done anything like that as a rule, although I've certainly done nice things for some of my students during the course of lessons.

That said, with some exception, I usually teach a normal lesson and give the student something to work on in my absence...if they desire. Or, I simply review some older fun songs or exercises. I just encourage them to play easy songs for fun once in a while so they don't forget all they've learned. A final thought is to test them on some basic vocabulary or other items. Sometimes students change teachers; it's good to make sure they have some basics down so if they go elsewhere, it doesn't reflect poorly on your teaching.