Money orders are easy to complete and require the same basic information. Most money orders are from one of three brand names: Western Union, MoneyGram, or the U.S. Postal Service.
Here’s a step-by-step guide on when to use a money order, where to get one, and how to fill it out correctly.
- Money orders are easy to buy and cash and useful for individuals without checking accounts.
- Once you fill in the recipient's name, the money order can only be cashed by the payee.
- When paying a bill, include an account or invoice number to ensure the payment is credited correctly.
- It can take up to 30 days or more for a refund if you cancel your money order.
When to Use a Money Order
When you need to pay someone or someone needs to pay you, but cash, a personal check, or a smartphone app are not available options, a money order might be the solution. Money orders are widely accepted because they are prepaid, eliminating the risk of non-sufficient funds.
A money order resembles a check and is more secure than cash because it names a specific recipient, who will have to endorse it and show identification to cash it. Money orders are beneficial for those who don't have a checking account or do not want to accept personal checks.
Certified and cashier's checks issued by financial institutions, often for large dollar values, offer more security than money orders but carry much higher fees.
Where to Get a Money Order
Buying a money order typically requires you to visit a location that sells them and leave with a paper money order in hand. U.S. locations that sell money orders, many with evening and weekend hours, include Walmart, CVS, or any of the 31,300 U.S. Postal Service (USPS) retail offices.
The U.S. Postal Service carries its brand and format of money orders, as do some banks and credit unions. Other sellers generally offer MoneyGram or Western Union. Whichever type you get, the seller will imprint the date and the amount and then give you the incomplete money order to finalize by hand.
Almost all money order purchases involve a fee, so it’s wise to shop around. Walmart charges $1.00 at most locations, and the USPS charges $1.75 to $2.40 depending on the amount. The value limit on money orders is $1,000, but you can order more than one at a time.
5 Things Needed on a Money Order
- Payee's name
- Payee’s address
- Payment amount
- Your name and address
- Memo line to include what the payment is for or a billing account number
How to Fill Out a Money Order
1. Fill in the name of the recipient
Write the name of the recipient, the person whom you are paying, in the “pay to” or “pay to the order of” field. Include the person’s name or the name of a business.
2. Add your address to the purchaser section
The "purchaser’s address" is the address of the individual who is buying the money order. There may also be an additional address field for the address of the payee.
3. Use the memo field
The memo line or field notes what the money order is designated for and if it is paying a certain billing account number.
4. Sign your name in the purchaser's section
Sign the front of the money order where indicated, but leave the back of the money order blank as this is where the payee will endorse it.
You will need to provide valid identification to purchase or cash a money order.
How to Deliver a Money Order
Once you've filled in all the fields, be sure to detach the receipt. This stub provides the money order's official identification number, and you can use it to track whether the money order was cashed, and it's also a record of your payment.
Now that you have a completed money order in hand and a receipt, you can safely hand deliver the money order or mail it to your recipient and only the recipient will be able to cash it.
Advantages and Disadvantages of Money Orders
It's easy to find a place to purchase a money order.
You don't need a checking account to purchase or cash a money order.
Only the recipient can cash the money order.
A money order can only be used for up to $1,000.
If you lose or need to cancel your money order, it can take up to 30 days or longer to be reimbursed.
Anyone can cash it if you forget to put the recipient's name on the order and lose it.
How to Cancel or Replace a Money Order
If you need to cancel or replace a money order, immediately contact the entity that issued it to you, and fill out a cancellation request form. Make sure to have your receipt and be prepared to show it. You will need to pay a fee for a canceled money order and you may ask for a replacement money order or a cash refund.
Whose Address Do You Put on a Money Order?
You need to put both your address and the recipient's address on a money order.
Do You Have to Sign a Money Order?
Yes, you do have to write out your signature on a money order.
What Happens If You Fill Out a Money Order Wrong?
Unfortunately, if you make a mistake, it is hard to correct. If you write out the wrong payee name or misspell it, you may have to ask for a refund, which could take 30 days, according to Western Union.
Can a Blank Money Order Be Cashed?
If someone finds a blank money order with a specified value amount on it, it can be filled out and cashed.
Can Anyone Cash a Money Order?
Only the payee can cash a money order with valid identification.
The Bottom Line
For less than $1,000, money orders can be an easy way to purchase something, pay a bill, or pay back personal debt. You can buy a money order for a small fee at convenience stores, money order businesses, big box stores, and some credit unions and banks. There are drawbacks to using money orders such as a limited amount of money on each order, fees, and a 30-day or more waiting period for a refund on a canceled money order.