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What Is a Money Order? How a Money Order Works and Where to Buy One
A money order is a guaranteed payment you can buy at places such as Walmart, the post office and your bank.
Margarette Burnette is a NerdWallet authority on savings, who has been writing about bank accounts since before the Great Recession. Her work has been featured in The Associated Press, USA Today and other major newspapers. Before joining NerdWallet, Margarette was a freelance journalist with bylines in magazines such as Good Housekeeping, Black Enterprise and Parenting. She is based near Atlanta, Georgia.
Yuliya Goldshteyn is a banking editor at NerdWallet. She previously worked as an editor, a writer and a research analyst in industries ranging from health care to market research. She earned a bachelor's degree in history from the University of California, Berkeley and a master's degree in social sciences from the University of Chicago, with a focus on Soviet cultural history. She is based in Portland, Oregon.
Wealth psychology expert and coach Kathleen Burns Kingsbury, founder of KBK Wealth Connection and host of the Breaking Money Silence podcast, is an internationally published author and speaker. As an expert on financial psychology, Kathleen has appeared on television and her work has been featured in The New York Times, The Wall Street Journal, "PBS NewsHour," Money magazine, Today Money, Forbes and CNBC. Kathleen served as an adjunct faculty member at the McCallum Graduate School at Bentley University from 2009 to 2019 and currently teaches at Champlain College.
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A money order is a safe alternative to cash or a personal check; it works like a check so you can cash it or deposit it into a bank account.
When using cash or personal checks puts you at risk, or they aren’t accepted for payment, you can use a money order instead.
You can use cash or a debit card to buy money orders at the post office, Walmart, Western Union and other places.
How do money orders work?
A money order is a piece of paper that’s a safe alternative to cash or personal checks. You specify who will receive the money order, and both you and that person must sign it for it to be valid, which cuts down on theft.
You also prepay for a money order when you buy it. They’re available at U.S. post offices, Walmart, Western Union and other places. Many have a $1,000 limit, including those that you purchase at banks. Generally, you must pay for money orders with cash or debit card.
🤓Nerdy Tip
A money order is a good option for sending money if you don’t have a bank account or don’t want to share your banking information with the recipient.
Money orders: Pros and cons
There are advantages and disadvantages to using a money order. Consider these pros and cons before you use one.
Pros:
No bank account required to send or receive a money order.
Money orders are widely available.
Cons:
Once a money order is cashed (or lost), it can be difficult if not impossible to get your money back, even if it was due to a scam or fraud.
Subject to cash advance fees and interest if purchased with a credit card. (Read about credit card interest, aka APR.)
How can I buy a money order?
Know how and who you’ll pay: Be prepared with cash or a debit card, the name of the payee and the amount you want to send. Paying with a credit card might be possible, but will usually cost extra.
Fill it out: In addition to the payee’s name, you’ll need to add your name (and maybe your address) and sign the money order. (For step-by-step instructions, check out NerdWallet's guide on how to fill out a money order.) Be careful to ensure that everything is accurate because you won't be able to change the information afterward.
Keep the receipt: The receipt will be a carbon copy of the money order or a paper slip recording the information entered on the money order. You may need it to track your money order or contact the place where you got it.
Track your money order: Your receipt will also have a tracking number that you can use to verify that the money order got to the intended recipient. If any problems arise, contact the place where you bought the money order to get help.
Where can I get a money order? How much does a money order cost?
You can get a money order at a post office, Walmart, Western Union and other places. Domestic money orders have a range of costs, from under a dollar up to around $5, depending on where you buy them. You'll get a better deal at Walmart or a convenience store or supermarket, and you'll typically pay more at a bank.
Not all providers offer international money orders; some post offices do, but they cost more than domestic money orders. And no matter where you buy them, it’s safer to buy money orders in person.
Provider
Cost
Walmart
Up to $1.
Money transfer agents (convenience stores, supermarkets, etc.)
Depends on the provider. For example, some San Francisco-area Western Union providers charge $1.
U.S. Postal Service
Up to $500: $1.65. $501-$1000: $2.20. Military money orders: 55 cents. International (up to $700): $49.65.
Banks and credit unions
Depends on the financial institution. Often around $5.
$5 for up to $1,000. Must be purchased in a branch.
When should I use a money order?
There are times when using cash or personal checks can put you at risk, or they aren’t accepted for payment. Here are four examples of when money orders are the best payment method:
You need to send money securely. Unlike checks, money orders don’t include your bank account number, and they help ensure that only the recipient can use it, unlike mailing cash.
You’re 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. (Read up on certified checks and find out more about cashier’s checks.)
You’re sending money internationally. Not all money orders work abroad, but U.S. Postal Service money orders can be sent to about 25 countries. Another option: A wire transfer (see how much banks charge for wire transfers), if you need the money there faster and are willing to pay more. Or check out our best ways to send money internationally.
You don’t have a checking account. Since money orders require you to pay in advance, you don't need a bank account and you can still pay bills safely.
🤓Nerdy Tip
If you don’t have a checking account, another option for paying for regular purchases and bills is to use a prepaid debit card.
4.20%SoFi members with direct deposit can earn up to 4.20% annual percentage yield (APY) on savings balances (including Vaults) and 1.20% APY on checking balances. There is no minimum direct deposit amount required to qualify for the 4.20% APY for savings. Members without direct deposit will earn 1.20% APY on all account balances in checking and savings (including Vaults). Interest rates are variable and subject to change at any time. These rates are current as of 04/24/2023. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet
4.75%Annual Percentage Yield (APY) is accurate as of 05/09/2023. APY is variable and subject to change at any time without notice. No monthly service charge. No minimum balance requirement. Must fund with 15 days of opening account.
These cash accounts combine services and features similar to checking, savings and/or investment accounts in one product. Cash management accounts are typically offered by non-bank financial institutions.
These cash accounts combine services and features similar to checking, savings and/or investment accounts in one product. Cash management accounts are typically offered by non-bank financial institutions.
4.50%Annual percentage yield (variable) is as of 5/8/23. 5.00% APY with a $75K deposit or 4.75% APY with a $25K deposit. New customers only with qualifying deposit. Terms apply.
Min. balance for APY
$0
CDs (certificates of deposit) are a type of savings account with a fixed rate and term, and usually have higher interest rates than regular savings accounts.
CDs (certificates of deposit) are a type of savings account with a fixed rate and term, and usually have higher interest rates than regular savings accounts.
5.10%The annual percentage yield is effective as of Friday, May 19, 2023. APY is a fixed rate and a $1,000 minimum balance is required. Bask Bank will pay this rate and APY through your CD maturity date. Fees could reduce the earnings on your account, and an early withdrawal penalty may be imposed for early withdrawal. If your CD is not funded with at least $1,000 within 10 business days after the date the account is opened, it will automatically be closed. Read the full terms here: https://www.baskbank.com/terms-and-disclosures.pdf
3.30%Your annual percentage yield can be as high as 3.30% based on the following combined rate rewards: direct deposits (not including intra-bank transfers from another account) totaling $1,500 or more each month will earn 0.40%. A qualifying direct deposit is required for the remaining interest rate qualifications to apply. Ten (10) point-of-sale transactions per month using your Rewards Checking Visa® Debit Card for normal everyday purchases with a minimum of $3 per transaction, or enrolling in Account Aggregation/Personal Finance Manager (PFM) will earn 0.30%; maintaining an average daily balance of at least $2,500 per month in an Axos Self Directed Trading Invest account will earn 1.00%; maintaining an average daily balance of at least $2,500 a month in an Axos Managed Portfolio Invest account will earn 1.00%; and making a monthly payment to an open Axos Bank consumer loan (commercial and business loans excluded) via transfer from your Rewards Checking account will earn a maximum of 0.60%.
Monthly fee
$0
Money market accounts pay rates similar to savings accounts and have some checking features.
Money market accounts pay rates similar to savings accounts and have some checking features.
Some outlets allow you to buy a money order with a credit card, but others don't, including Walmart and the U.S. Postal Service. In those cases, you'll have to use a debit card or cash to buy a money order.
Even if the provider you choose does let you pay with a credit card, it'll be much cheaper not to. That's because credit card issuers typically treat money orders as cash advances, charging a fee based on the amount of the transfer — often 3% to 5% — and assessing interest immediately. That interest rate might be greater than the rate you'll pay on a normal purchase.
Where can I cash a money order?
You can try cashing a money order at the same entity that issued it, whether that’s a bank branch, post office or other location. Note that not all Western Union locations that sell money orders are able to cash them.
Some banks will cash money orders issued by the same bank or by USPS, but may charge a fee if you’re not a customer of the bank. Check-cashing locations, convenience stores and grocery stores can be alternatives, but watch out for fees. Wherever you go, you’ll probably need to show identification.
If you don’t need the money right away and you have a bank account, consider depositing it. Banks accept money orders as they would regular checks at branches, ATMs or even on a banking app with a mobile check deposit function. Don’t forget to sign the back of the money order before depositing.
If you no longer have the money order or you made a mistake on it, you may be able to cancel it and get a replacement or refund — as long as the money order hasn't been cashed.
You’ll need to bring your receipt and the money order itself, if you have it, to the place where it was purchased. The issuer will probably have you fill out some paperwork, using information from your receipt, and you'll likely pay a fee. For example, Western Union charges $15 to replace a money order. And it can take a month or longer for the issuer to process your claim.
If the money order was cashed fraudulently, you may still be able to get your money back, but you'll generally have to involve the police.
Money orders are typically a safe payment method, but they can also be used fraudulently. To protect yourself:
Try not to exchange money orders with strangers. This isn't always possible, but if you can, ask to be paid electronically or via another means.
Watch for red flags. These might include sending extra money back to someone who claims they've paid too much, or visual cues, such as missing watermarks or amounts more than $1,000.
Verify the funds. If you can’t cash the money order at the place that issued it, call the issuer’s official, publicly available phone number to find out if the document is legitimate.
Can I buy a money order with a credit card?
Some outlets allow you to buy a money order with a credit card, but others don't, including Walmart and the U.S. Postal Service. In those cases, you'll have to use a debit card or cash to buy a money order.
Even if the provider you choose does let you pay with a credit card, it'll be much cheaper not to. That's because credit card issuers typically treat money orders as cash advances, charging a fee based on the amount of the transfer — often 3% to 5% — and assessing interest immediately. That interest rate might be greater than the rate you'll pay on a normal purchase.
Where can I cash a money order?
You can try cashing a money order at the same entity that issued it, whether that’s a bank branch, post office or other location. Note that not all Western Union locations that sell money orders are able to cash them.
Some banks will cash money orders issued by the same bank or by USPS, but may charge a fee if you’re not a customer of the bank. Check-cashing locations, convenience stores and grocery stores can be alternatives, but watch out for fees. Wherever you go, you’ll probably need to show identification.
If you don’t need the money right away and you have a bank account, consider depositing it. Banks accept money orders as they would regular checks at branches, ATMs or even on a banking app with a mobile check deposit function. Don’t forget to sign the back of the money order before depositing.
If you no longer have the money order or you made a mistake on it, you may be able to cancel it and get a replacement or refund — as long as the money order hasn't been cashed.
You’ll need to bring your receipt and the money order itself, if you have it, to the place where it was purchased. The issuer will probably have you fill out some paperwork, using information from your receipt, and you'll likely pay a fee. For example, Western Union charges $15 to replace a money order. And it can take a month or longer for the issuer to process your claim.
If the money order was cashed fraudulently, you may still be able to get your money back, but you'll generally have to involve the police.
Money orders are typically a safe payment method, but they can also be used fraudulently. To protect yourself:
Try not to exchange money orders with strangers.
This isn't always possible, but if you can, ask to be paid electronically or via another means.
Watch for red flags.
These might include sending extra money back to someone who claims they've paid too much, or visual cues, such as missing watermarks or amounts more than $1,000.
Verify the funds.
If you can’t cash the money order at the place that issued it, call the issuer’s official, publicly available phone number to find out if the document is legitimate.
Money order tracking
It's relatively simple to find out where a money order is — as long as you've kept your receipt. But the process varies slightly by issuer. The U.S. Postal Service and MoneyGram allow you to track online with information such as the serial number found on your receipt and the purchase amount. Your bank should be able to provide you with the same information.
Without the receipt, you'll likely have to file a research request to find your money order's serial number, and that's expensive and time-consuming. At MoneyGram, for example, it costs $40 and can take 60 days to process.
Just be sure to track the money order with the actual provider — it might be Western Union or MoneyGram even if you purchased it at a convenience store. The money order should clearly show or state who the provider is.
