We're about to get a nice refund from the government (yes, I know it's an interest-free loan to Uncle Sam, but our mustaches are still quite small and it's easier not to spend it if it's not there in the paycheck)
About 7,000 of this refund is earmarked for a new car. Our 2001 Avalon will die in the next 1-4 years.
Because I don't know when the car will die, I was going to just keep it in a savings account. Would it be better to put it into my Vanguard savings account where it will earn more? I just started the vanguard account last year and have never taken anything out (all money is currently in VTSMX). If I have to take the car money out earlier rather than later, will the taxes I have to pay on the capital gains nullify the gains I got by investing it rather than stashing it in a savings account?