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Money orders are affordable, you don't need a bank account, and you can fill one out in four easy steps.
Most money orders require the name of the recipient, your address, and your signature, with space for a memo or your account number if you’re paying a bill
Always keep the receipt in case there is an issue or if your money order is lost or stolen
A money order is a printed certificate that’s written for a certain amount of money, much like a personal check. Unlike a check, you need to buy a money order — only certain places sell them — and you have to pay the amount of the money order up front. So if you want to send a $30 money order, you need to pay $30 up front and then pay the fee, which is usually a couple of dollars.
Money orders are popular because they are cheap, simple to fill out, and you don’t need a bank account to get one.
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There are many places where you can get a money order:
Many of the money orders from the stores and companies above are provided by MoneyGram, or through a partnership with Western Union. The U.S. postal service has its own money order, which is then easy to send through the mail if necessary.
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Money orders look similar to personal checks and filling them out is also a similar process
This is the name of the payee: the person or company receiving the payment. The line you write this on usually says Pay to or Pay to the order of. Some money orders, like from the USPS, also have space for the recipient’s address.
Make sure you write the recipient’s information clearly and spell everything correctly. You cannot make changes to the money order if you make a mistake.
Next is usually a line that says Purchaser’s address. You are the purchaser and so you should write your current mailing address. Some money orders may use the words From, Sender, Issuer, Remitter, or Drawer.
Putting your address allows the recipient (wherever they deposit the money order) to contact you if they want to confirm that it’s real or if there is an issue. Some money orders ask you to write (not sign) your name as well. USPS money orders have a line for your name above the lines for your address. It’s best to use your full legal name.
Many money orders have an additional line that says Payment for, Account number or Memo. If you’re paying a bill, you can write your account number on this line to help the recipient know which account to credit. You can also leave a memo on this line, or just leave it blank if you don’t need it.
The final line on the front of the money order is usually for your signature. This line may say Purchaser’s signature, or just Purchaser. In the case of MoneyGram, the signature line also says Signer, or Drawer.
Not all money orders require your signature. For example, it isn’t necessary to sign a USPS money order.
The back of the money order has a line for the recipient’s signature, so make sure you sign on the front, not on the back.
Depending where get the money order, it will either have a detachable receipt or the seller will simply give you a separate receipt. Make sure to keep this as proof that you purchased the money order. You may need it if your money order is lost or stolen and you need to try and get a refund.
You can also use the receipt to track your money order and see if it has been deposited. To do this, you will need the serial number, tracking number, or money order number written on the front and the exact amount of the money order. Tracking a money order does cost extra, though. You can expect to pay at least $5.
Money orders are a simple way to send payments, especially large payments where cash isn’t an option. Because you pay for a money order up front, the recipient knows that it will not bounce. That’s why they’re popular for payments like a credit card bill or the deposit for an apartment.
It’s also difficult for someone other than your intended recipient to deposit or cash a money order: they will need to provide the proper identification for a place to accept a money order.
The other big advantage with a money order is that you can send them even if you don’t have a bank account. As long as you can afford the payment and the small fee, you can get one. Your recipient doesn’t need a bank account either.
Here are some other ways to send money without a bank account.
There are a couple of potential drawbacks to consider with money orders. First is that they usually have a limit of $1,000 per day. That means you may need to get multiple money orders, over multiple days, for a big payment.
You will also need to pay a fee to get a money order. The fee varies but it’s usually about $2, which is actually lower than the cost of most alternatives.
Keep in mind that you will need to pay for a money order up front. That means when you go somewhere to get one, you need to have either enough cash, a credit card, debit card, or sometimes traveler’s checks.
The main alternatives to money orders are a cashier’s check or other official bank check, such as a certified check. These all work similarly to a money order but instead of getting them from a third party, you need to get them from a bank or credit union.
(Learn more about whether you should work with a bank or credit union.)
You will need to provide the information for your recipient, and you will need to have enough to pay the amount of the check. You will pay the bank, which will write the check in its own name. A cashier’s checks will not bounce because it is backed up by the bank itself. Cashier’s checks usually have a fee of about $10 and you usually need to have an account with the bank already.
Cashier’s checks are also an option if you’re sending money from one bank to another.
You may also want to consider a wire transfer. Wire transfers are the fastest way to send funds and usually go though within a few hours. However, they also have a high fee of $30 or more.
If you’re only sending a small amount of money, an ACH payment is a good idea. These are digital payments that also transfer very quickly. Many banks allow you to make ACH transfers and you can also use services like PayPal, Venmo, or Zelle.
About the author
Derek is a tax expert at Policygenius in New York City. He has written about multiple personal finance topics in the past, and his work has been covered by Yahoo Finance, MSN, Business Insider and CNBC.
Policygenius’ editorial content is not written by an insurance agent. It’s intended for informational purposes and should not be considered legal or financial advice. Consult a professional to learn what financial products are right for you.
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