Go to bankrate.com, search for the bank with the highest savings and/or Certificate of Deposit (CD) rates where you also meet the minimum deposit requirement. Open the account, deposit money, watch it grow. The online banks have much higher interest rates than a regular bank would. You can also ladder CDs - have several CDs all maturing at different times, when the first CD matures, take it out, reinvest it plus the profit you made into the next CD that matures and so forth. I would advise against investing in any stocks since it doesn't sound like you have that big of refund nor can afford to lose any money. Your savings style should be moderate to conservative, with a focus on preserving principle funds (your original amount). Maximizing on compounded interest is the safest way to see returns. Of course, you have to be comfortable not being able to touch that money for 1-5 years.
at 10:14 PM on Feb. 6, 2013