How do you handle money your young children receive?

Kids often get money from relatives for occasions like birthdays and holidays. My kids are younger (under 4). I'm typically torn between sticking the money in a high yield savings account, investing in a fund I can pull money for them at a later date, or putting it into their college savings. I lean towards college savings, but for some reason that feels a little wrong. Not sure why, but interested in what others do.