My SO was going to use some cash our kids got easter egg hunting to buy some kid supplies. I always put the cash I open in cards for the kids in their piggy bank.
She admits she always uses that cash to buy them stuff.
I admitted that I thought we were both filling their piggy bank.
She has requested that I ask "the communists [you] talk to" what they do (haha).
Bare in mind, this really only applies to kids who have no concept of money. Obviously, we both agree once they have that concept, its theirs to do as they please.
(This isn't a heated disagreement BTW just a funny revelation)
Whenever it's a large enough amount of money ~$100, I usually just drop it in my bank account and put that amount plus a bit extra in an education savings account. My kid is still young enough to not really understand money.