A money order is a printed document that you can use to make payments, up to a $1,000 limit. Unlike personal checks, money orders are paid for up-front, so they're generally good for their face value. This makes them safer and more predictable than personal checks, which can bounce if your account balance gets too low. Businesses may require a money order instead of a check when they need to guarantee that they'll receive the payment.
How to Fill Out a Money Order
The only information you need for a money order is your name, your address and the name of the person or business you want to pay. This authorizes the person or company to cash a money order and prevents it from being cashed by anyone else if your money order gets lost. The amount of the money order will be printed by machine when you purchase it, and cannot be overwritten or changed after you pay. Aside from the line for purchaser address, the front of a typical money order tends to resemble a personal check.
A money order requires the sender's signature to be considered valid. If you're using the money order to pay for a bill, it's a good idea to write down the relevant account number in the field provided. This isn't strictly necessary, but including that information may help ensure that your bill payment is credited to the right account. Finally, be sure to keep the receipt for your money order, so that you can track the money order and confirm when it is deposited. You'll also need the receipt if you ever happen to lose the money order.
Where Can I Get a Money Order?
While money orders are available at dozens of locations, the most affordable option near you is probably a post office or a Wal-Mart store. Wal-Mart MoneyGrams cost $0.70 for all amounts, while USPS Money Orders cost $1.20 to $1.60. Pharmacies, supermarkets and money transfer offices like Western Union also carry money orders, but their prices can vary by location. Banks provide money orders as well, but their high fees and rules preventing non-customers from buying money orders make them the least sensible choice.
|Issuer||Sending $500 or less||Sending $500 to $1,000||Locations|
If you're trying to send money to another country, the post office is the easiest place to find international money orders. You'll have to pay $8.25 for the money order itself, along with an extra amount for postage. The USPS limits international money orders to $700, with a lower $500 limit on orders sent to El Salvador or Guyana. While money orders are an extremely safe means of transferring funds, sending money through online transfer services can save both time and money without sacrificing too much security.
Where to Cash a Money Order
The easiest way to cash a money order is to take it to the same company or service that issued it. If you have a checking or savings account, you can also take money orders to a bank branch, where you can deposit the amount directly into your account balance instead of getting it back in cash. Before you get your money, though, you'll need to take a few more steps.
Verify the money order: If you have any doubts about the authenticity of a money order you've received, you can call the issuer with the money order number, amount and date. This is a safe way of determining whether there's anything wrong with the money order —so long as you make sure to call the right phone number.
Money Order Verification – Phone Numbers
- USPS: 866-459-7822
- Western Union: 800-999-9660
- MoneyGram: 800-666-3947
Show ID: You'll always need some identification to prove that you are the payee listed on the money order. Make sure your name and address match the information the sender wrote on the money order.
Sign the back: Like personal checks, the back of a money order has a space for the payee's signature. If you're cashing it at a bank, you can also list the money order as a check when you fill out the deposit slip.
Replacing Lost Money Orders
If you happen to lose a money order that you purchased, you can use the information on your receipt to request a refund or replacement. The fastest way to do this is to visit the issuer in person, where you'll fill out a request form with the money order number, amount and date of purchase —the same information you would need to verify a money order you receive. Additionally, you need to provide your own name and address as the purchaser.
If your misplaced money order has already been cashed by someone who found or stole it, you'll receive a photocopy of the money order rather than a refund. Either way, you'll need to pay a service fee when you make the request. If you don't have your original receipt, some issuers like Western Union will raise the fee, while others may deny your request completely. In many cases, you may be able to proceed without a receipt as long as you have all the information originally on the receipt.
Cashier's Checks vs. Money Orders
Cashier's checks are basically no-limit money orders issued by banks at a price of $7 to $10. As with money orders, you pay for a cashier's check up front, so that the full amount is guaranteed to the recipient with no risk of "bouncing" like a personal check. However, only banks can issue cashier's checks, which are funded directly from bank assets. This qualifies them as "guaranteed funds" under Federal law, which means that banks must make at least $5,000 of a deposited cashier's check available by the end of the first business day.