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Nov 11, 2012 6:05 AM in response to mslossby Dah•veed,The iTunes and Mac App Stores always uses any credits on the account first and then draws any debit balance from the bank card on the account.
You might consider creating Apple IDs for your children so that what they purchase is theirs and not forever tied to your Apple ID. Apple does not transfer content from one Apple ID to another nor merge ID accounts. If you set up accounts for your children you can fund it with iTunes Gift Cards or you can set up an automatic monthly allowance until the day they are old enough to assume the funding of their own purchases.
Frequently asked questions about Apple ID