When making a purchase or selling something, Money Orders are one of the safest form of payment! Money Orders are a printed order for payment of a specified sum, issued by a bank or post office. Similar to check they are used for payment but can be easily tracked and canceled.
Additionally, all the information, such as the recipient is listed out which makes loss or stolen money less problematic. You can also get an Money Order at convenience stores to retailers. Check out our Bank Bonuses, Saving Rates and Credit Card Bonuses!
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How Money Orders Work
Basically, a money order works similarly to a check. All you have to do is fill out the name of the recipient on a form and the amount the recipient should receive. Keep in mind that money orders have a maximum amount of $1,000. So, if you need to send more than the max amount, you will need to write multiple money orders.
The financial institution that you choose to send this with will have the payee’s name, the issuer’s name, and the amount of money that can be cashed. This dollar value does not include any fees that are charged to the payee. Make sure you know all the costs that come with issuing a money order. Banks and credit unions will charge more than a convenience store to issue money orders.
How Can I Buy A Money Order
To start the process of purchasing a money order, you must have a cash or debit card, the name of the payee and the amount you want to send. You can pay with a credit card, however, it might cost extra to do so.
On top of the payee’s name, you will need to add your address and sign the money order. The receipt will be a carbon copy of the money order or a paper slip recording the information entered on the money order.
Additionally, your receipt will also have a tracking number that you can use to verify that the money order you sent has made it to the intended recipient. If any issues come up, you can contact the place that you bought your money order from to get help.
Places To Get a Money Order
Domestic money orders can generally cost anywhere from less than a dollar all the way up to $5, depending on where you buy them. The best deals can be at Walmart or with a money transfer agent.
Not all providers will offer international money orders, but some post offices will offer this feature. Keep in mind that international money orders will cost more. Military personnel can receive a discount at military post offices.
| Provider | Cost |
| Walmart | Up to 88 cents |
| Money transfer agents (convenience stores, supermarkets, etc.) | Depends on the provider. For example, San Francisco-area Western Union providers often charge around $1. |
| U.S. Postal Service | Up to $500: $1.25 $501-$1000: $1.70 Military money orders: 45 cents International (up to $700): $9.50 |
| Banks and credit unions | Depends on the financial institution. Often around $5. |
Money Order Features
- Can track or cancel Money Orders, and they’re always “made out” to a particular recipient.
- All information will be pre-printed on the face.
- Used if you don’t have a checking account, mailed payments, to prevent bounced checks, to avoid using personal checks, to send money overseas.
- Accepted at banks, businesses, & individuals.
- Are a form of “guaranteed” payment.
- Less expensive for recipient than credit cards.
- Cost up to $5.
- You can get them at check-cashing locations, convenience stores, gas stations, drugstores, post offices, & retailers.
Can I Buy A Money Order With A Credit Card?
There are a couple of answers to this question, but the basic answer is that it depends. Some places will allow you to buy a money order with a credit card, but some places don’t allow it, including Walmart and the U.S. Postal Service. At these locations, you will have to use a debit card or cash to make your purchase.
Even if the provider does allow you to pay with a credit card, there may be fees associated with the purchase. Credit card issuers tend to treat money orders as cash advances, charging a fee based on the amount being transferred ranging from 3% to 5%. This rate may even be greater than the rate you would have paid on a normal purchase.
The Advantages and Disadvantages of Money Orders
In some instances, paying with a money order can be safer than paying with a personal check. The reason being personal checks include the account holder’s routing number and bank account number printed on the bottom. This private information is sensitive and you are more vulnerable to identity theft and fraudulent checks. Money orders do not include any personal information.
Pros.
- Money orders do not include personal information, such as your bank’s routing number and your bank account number.
- The recipient can cash the order at a local bank or credit union—there’s no requirement to go to the issuer to have it cashed.
- Money orders can also be deposited into a bank account, for no fee.
- The money order can be issued in one country and be cashed in another country.
Cons.
- Money orders can be more difficult to track than a personal check—to find out whether the money order has been cashed, for example, can require forms and take weeks.
- Cashing the money order can incur a fee.
- There may be a delay in getting the funds if they are cashed at a bank other than the issuer.
- Money orders can be fraudulent; be wary about receiving them from people you don’t know and don’t spend money orders you deposit in the bank until you know the bank was able to cash them.
Money orders can be more difficult to keep track of than a normal check. To know if a personal check has cleared, all customers have to do is head to their local bank or go online into their bank account.
To track a money order, the issuer must fill out tracking forms and pay an additional fee to learn whether the money order has been cashed. The entire process can take weeks, but luckily, the USPS offers a money order inquiry service that can help make the process shorter.
When Should I Use a Money Order?
Although money orders are very convenient and safe, sometimes they can be a risky move. Sometimes they aren’t even accepted as a form of payment. Here are some examples where money orders are the best payment method:
- Send a payment more securely. Unlike checks, money orders don’t include your bank account number.
- You don’t have a checking account and need to pay bills. Since money orders require you to pay in advance, the money isn’t tied to any bank account and can be sent to other people.
- Worried about bouncing a check. Because money orders are prepaid, they can’t be rejected for insufficient funds.
Another option: A certified check or a cashier’s check, both of which guarantee payment and don’t necessarily have a $1,000 limit, unlike many money orders. - You’re mailing money. A money order helps ensure that only the recipient can use it, unlike mailing cash.
- You’re sending money internationally. Not all money orders work abroad, but U.S. Postal Service money orders can be sent to about 30 countries.
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Bottom Line
To make an safe and easy payment on anything, check out Money Orders! Please note that depending on where you get your Money Order from there may be a fee of up to $5 and it’s usually more expensive at banks or credit unions compare to convenience stores and more.
Make sure to keep your receipt to keep track of your Money Order or cancel it if needed. If you’re planning on making a payment for something and want your cash to be safe until delivered, make an Money Order today. Check out our Bank Bonuses, Saving Rates and Credit Card Bonuses!
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