Even despite the rise of technology, many people continue to use the old tried and true money order. There are so many different ways to send money electronically in this day and age, but money orders continue to remain relevant. They are a dependable, and safe way to pay a bill or to exchange cash with another person or institution. So even though there are much quicker and easier ways to send or transfer money, we’re here to teach you everything you need to know about a money order.
What is a Money Order?
It is a prepaid document issued by a company and is one step down from a bank check. Essentially, you are giving money to the business you purchase the money order from, and in return, they are giving you a check to pay your bill with that is guaranteed by that business. Landlords will often accept these because they know that the money is guaranteed.
The purchaser pays the amount plus a fee for the money order and then they are free to make it out to whomever they please. For instance, you might want to pay an electric bill or your rent. As long as you keep the stub, you have proof that you’ve paid a bill. These are guaranteed funds and that can be important when paying certain bills.
You can pay for a money order using a debit card or cash. Many establishments will not take a credit card as payment for these products. This is because the business issuing the money order wants to make sure they get paid. If they allow you to purchase on credit, you may not pay your credit card bill and then that business is out of the money.
Why Should I Use a Money Order?
You might be wondering why someone would use a money order instead of other quicker and easier forms of payment. There are actually several good reasons why. We’ll go over a few below:
Guaranteed Funds: They are prepaid. This means the funds are guaranteed and you don’t have to worry that your check will bounce when you go to pay your bill.
Theft Protection: Once you purchase the money order, fill in the name of the person you’re sending it to. As long as you have filled in a name, it cannot can’t be stolen. Only the person specified as the recipient will be able to cash it in.
Safety: What if you want to make a big purchase but don’t want to carry a large amount of cash around? Instead, buy a money order to pay for the purchase. This way, you aren’t carrying wads of cash and only the name you fill in can cash it in.
Privacy: Sometimes we are required to make payments to people or companies that we don’t really trust. Maybe you don’t want to share your personal information with them. A money order doesn’t have your address or phone number on it.
How To Get A Money Order
They are produced by two well-known companies: Western Union and MoneyGram. These are both reputable companies that can be trusted. However, you actually purchase money orders from other businesses. The most common places include convenience stores, national grocery chains, and big-box retailers.
It is important to note that each company can charge their own price, but the most well-known places like 7-Eleven have consistent prices regardless of where you purchase.
9 Best Places to Purchase a Money Order in 2020
Most of us should have a 7-Eleven nearby given that they have 8,500 locations in the United States. There is literally almost one on every corner in some cities. The prices vary from 1.0% to 3.0% of the total amount of the money order. For instance, if you purchase a money order for $300 and the store is charging a 2.0% fee, the cost will be an extra $6.00. 7-Eleven charges a minimum fee of $0.65 and the maximum amount you can get a money order for is $500. If you need a money order for more than that, you will have to make multiple money order purchases.
Walmart is a great place to buy a money order and most Americans will visit a Walmart store almost weekly. With over 4,000 locations in the US, it is fairly easy to find one in your neighborhood. They use MoneyGram and they charge $0.70, which is a real bargain. They can issue money orders of up to $1,000 making this is a great place to get those larger dollar amounts. Walmart also cashes them but they charge from $3.00 to $6.00 for this service.
Publix is another dependable place to buy a money order. However, this chain is located mostly in the southeastern United States. They charge $0.85 per money order and they will not cash money orders.
Kroger is a well-known grocery store chain with over 2,700 locations in the United States. Their fees are only $0.70 but they do vary by state. Kroger stores operate under different brand names including Smith’s, Fry’s, Dillon’s, King Sooper’s, and Fred Meyer stores. The max amount you can buy is between $500 and $1,000.
CVS Pharmacy is another safe place simply because they’re reputable and there are over 9,600 locations in the US. CVS uses MoneyGram and they charge a flat fee of $0.99. Search for a local CVS store to purchase a money order by going here.
Meijer is another chain that may or may not be familiar in your area. They only have about 250 locations mostly located in Indiana, Michigan, Ohio, and Illinois. They use Western Union and charge $0.65 per money order. The maximum amount is $500 and they do not cash them.
7. Your Local Bank
Banks traditionally charge the highest fees, but they may offer you a lower fee if you have an account with them. Each bank has its own fee structure and its own rules about the amounts they will sell. Almost all will sell money orders for up to $500 but some may offer higher amounts up to $1,000. Check with your local bank to get the correct info and fees.
8. United States Postal Service
Your local post office will probably sell money orders. The USPS has the most locations of any other places with over 30,000 post offices across the United States. If you plan to purchase a money order from USPS, there are a few things to know. Their pricing will vary based on the total amount. They sell money orders up to $1,000. And, they do not use Money Gram or Western Union. Instead, the post office has its own brand. You can cash a money order at any post office but it does require proper ID.
9. The Credit Union
Last, credit unions will usually sell money orders and their fees are among the lowest. Most of them also cash money orders but be sure to call ahead to check their fees. The amounts they will sell vary by each individual establishment.
What If I Lose My Money Order?
Losing a money order that has not been filled out is just like losing cash. Anyone can put their name in the recipient line and cash it at a local bank or post office. Most providers of money orders do have a system to replace lost or stolen money orders. However, they may charge a higher fee for this service but if you can replace a lost or stolen money order, then it’s probably worth it to pay a little bit more.
What About Fake Money Orders?
Unfortunately, there are people out there who design fake money orders and try to sell them to the unsuspecting public. In order to avoid this, be sure to always buy your money order at a legitimate place like 7-Eleven or the post office.
Money orders may seem like a dated way to pay considering the widespread use of Venmo, PayPal, Zelle, Apple Pay, etc. However, it is still a great, secure way to pay your bills and make large purchases. Be sure to shop safely though and only deal with local businesses you know and trust. This way, you can shop with confidence, while saving time and money.