Although I like to write and share about higher-level areas of personal finances, sometimes we still have to cover the very basics too.
And one topic I thought would be worth covering a bit is about a money order.
Depending on your experience and financial knowledge, you may never have heard of this or maybe you are aware of it but never actually needed to get a money order before.
Either way, it’s important to understand why you might want to use a money order, the best places to get one, and learn more about them.
No matter your reasoning for landing on this post, this should help you understand and be prepared if the time comes when you need to buy a money order.
What is a Money Order?
A money order is a physical document that looks pretty much like a check and is used as a method of payment. However, a money order is pre-paid where you will pay the amount needed upfront plus any fee that is charged for ordering one.
It acts as a safer alternative to cash and checks: you prepay the total amount and send the money order to a specific person or organization.
The funds are guaranteed and both parties must sign the money order for it to be valid – this reduces fraud, theft and since the funds have already been paid, the order cannot bounce back (unlike a check).
If you are buying a money order, you will be paying for the issued amount you need plus there will be a fee for creating the money order from where you buy it. Naturally, if you need to send a money order you want to get it from the location with the lowest fees to save you money.
And you can pay for a money order via direct cash, debit card, or any other form of payment that funds would be guaranteed.
Money orders are available at thousands of locations across the US and are a cheap and secure way to send money across the country. Money orders have a limit of anywhere between $700- $1,000, which depends on the issuer. But you can use several money orders at once if you need to send a higher amount.
Why Would You Use A Money Order?
You might be wondering why you might want to use a money order. Afterall, there are tons of ways to send people money these days.
Well, it’s a personal preference for one but there are a few reasons why a money order may be useful to you:
You don’t have a bank account
The issuing party doesn’t need a bank account in order to send a money order. If you don’t have a bank account, you can easily purchase a money order with cash and send it to the receiving party without any bank details needed. This is useful if you don’t want a bank account or don’t qualify for one.
You want to use something safer than cash
Sending cash through the mail is risky since your money has a better chance of getting lost or stolen. With a money order, your money is sent securely.
If the money order isn’t cashed or is lost or stolen, you can easily cancel it and get a refund, or simply replace it with a new one.
And since you have a specific person’s name on the money order, it’s pretty much impossible for a thief to cash it. Plus, most money orders don’t include bank account numbers or sensitive information in order to be sent.
You want to send money overseas
With a money order, you can send money overseas securely and relatively cheaply. By using the US Postal System, you have the opportunity to send a money order to 30 different countries, and your recipient can easily convert the amount into their local country.
Fees are not too high (compared to some banks) and the system is relatively simple.
Your seller requires a money order
Some sellers prefer being paid with money orders instead of personal checks.
If you’re buying a large item from a private seller, for example, they may require a money order so they don’t run the risk of not receiving the money. This guarantees that the funds are there and that the money won’t bounce.
You’re making a large purchase
If you’re buying a large item such as a car from a private seller, you may not want to carry a ton of cash on you.
With a money order, you can carry the same amount and not run the risk of getting robbed or losing your money. This is common through sites such as Craigslist where people buy and sell large ticket items to strangers.
More privacy
Lastly, you might want to get a money order for privacy reasons. With technology and identity theft rampant, you may want to be extra cautious.
For example, you might be purchasing something from a company or person that you don’t know or feel comfortable sharing any personal information.
That’s where a money order is perfect, because your bank information and other info is not included.
Best Places to Get A Money Order Near Me
Before we get into the options of where to get a money order near you, there is one well-known online place you might want to consider called MoneyGram.
They are one of the popular and trusted choices to choose if you want to buy and send a money order online. You can also pay bills, send money to a bank, and more. Learn more about MoneyGram here.
However, before making a decision on where to get your money order, it’s important to know all your available options. And the important thing you want to look for is that you aren’t being overcharged in high fees and that the place you order from is legit.
Here is a list of some of the options besides MoneyGram that you have.
1. Banks and credit unions
Your own bank is one of the best places to buy a money order for security reasons. Having said that, money orders placed through a bank will often be more expensive than by other means, with fees ranging from $5 to $10.
The main advantage of using a bank or credit union is that they will track the money order for you, so you can rest assured it’s arriving at the correct place.
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2. USPS
The US Postal Service is another great choice to send money orders. You’ll be able to send money orders to 30 countries in the world and can be assured that your money is safe.
Be aware that not all post offices issue money orders, so you’ll need to call in advance to make sure they do. Money orders usually cost between $1.25 and $1.75 depending on the total amount you are sending.
You can send up to $1,000 in a single order anywhere in the United States and up to $700 internationally.
3. Money agents
Money agents include convenience stores, supermarkets and money transfer agents such as Western Union, CVS, and payday loan shops. These are conveniently located and are likely to issue money orders too.
Make sure you check the fees before buying your money order so you don’t overpay and check out the limits.
For example, some may only allow up to $500 currently for money orders. I’d also recommend avoiding payday loan shops as they will likely have very high fees.
4. Walmart
Walmart is the cheapest place to purchase and send a money order. There are thousands of Walmart kiosks across the country, so you’re likely to have one close by. Walmart money orders charge up to 88 cents, making it the most affordable option to buy and send money orders.
You’ll also be able to cash a money order at Walmart, although that can only be done if the money order was originally purchased at Walmart. You’ll also need to pay a fee of up to $6 in order to cash it.
5. 7-eleven
Like Walmart, there are thousands of 7-eleven stores all over the country. They charge a minimum fee of $0.65 in addition to 1-3% of the amount on your money order.
7-Eleven uses Moneygram as well as Western Union to send the order, depending on the location. However, the maximum you’ll be able to send is $500.
6. Publix
Publix also has several locations across several states, most in the southern United States like Florida, Georgia, Tennessee, etc. Publix uses Western Union and will charge around $0.85 per money order, which is generally higher than some of the other options in this list.
They also won’t cash money orders and have a limit of $500.
7. Local check cashing company
In addition to convenience stores, banks and money transfer agents, you can also buy money orders at your local check cashing company.
There are hundreds of those in several cities, and check cashing companies may be the best choice depending on your location. Many of these companies do charge higher fees and will have certain limits on how much you can buy.
How Do You Purchase A Money Order?
You will need to provide some information in order to buy and send a money order. You’ll need the name of the payee, your own address, and the amount you want to send.
You’ll then need to buy the money order either with cash or with your debit card. If you’re paying a bill, you may need to add an account number.
Buying and sending a money order won’t cost too much, although the fee varies depending on where you purchase it.
At some places, you may expect to pay 88 cents for a money order and around $5 at a money transfer agent. If you’re doing an international money order, some post offices may charge you higher fees.
Although some providers will let you buy the money order with a credit card, keep in mind that you’ll need to pay an extra fee. That’s because credit card companies can charge up to 5% for a cash advance like a money order.
It’s usually safer to purchase your money order in person since online money orders might be scams or illegitimate.
Although there are a few websites that allow you to purchase a money order online, many are based in other countries and require both recipients to be based in that country. An alternative is to do money transfers through a company like PayPal.
Can you buy a money order online?
It is possible to purchase a money order online, but your options quite limited compared to your bank or local grocery store. And there are a few scams to watch for, so make sure you do your research. If you need to send money via the internet, you are better off using a service like PayPal or MoneyGram.
What If I Lose My Money Order?
You can cancel a money order if it has not been cashed yet through the issuer. If the money order has been cashed, unfortunately in most cases you most likely will not get your cash back or a replacement money order.
If your money order was stolen or fraudulently cashed, you may be able to collect your money back. If you received a copy of your money order, you can use this to file with your local law enforcement. And if they catch the criminal, you may have the money returned to you.
There you have it, every you need to know about money orders. Hope this was helpful in understand why you might want to use one and the best places to order one.