Money orders are another alternative to paying with a personal check, cash or cards. A money order is a prepaid check that isn’t tied to a bank account. Cashier’s checks and money orders are common ways to pay for purchases without using cash, debit cards or personal checks. People may use cashier’s checks or money orders because a vendor requires them or because they don’t want to carry around large amounts of cash.
When to Use a Bank Check vs. a Money Order
When she’s not writing, you’ll find her trying out a new karaoke spot or planning her next trip abroad. Know the exact amount you need for the money order and who you’re paying with it. If you need more than $1,000, you can simply buy multiple money orders. For instance, if you need to send someone $2,500, you can buy two money orders for $1,000 each and one for $500. Cashier’s checks come in handy in this scenario, because they feel more official.
TIME Stamp: Cashier’s checks and money orders provide secure alternatives to cash
Walmart, for example, recommends bringing identification for money order purchases above $1,000. The offers that appear on this site are from companies that compensate us. But this compensation does not influence the information we publish, or the reviews that you see on this site.
- Here are some situations where you may want to use a cashier’s check.
- A money order is a prepaid payment instrument that functions similarly to a check, but without the need for a personal bank account.
- A money order is optimal for purchases below $1,000, letting you avoid using a personal check.
- When she’s not writing, you’ll find her trying out a new karaoke spot or planning her next trip abroad.
- A cashier’s check is a type of check that is issued by your bank or credit union.
Editorial Independence
- Here’s a closer look at each form of payment and how they differ.
- If the purchase is smaller and the seller accepts money orders, a money order can be a less expensive and still secure option.
- From budgeting basics to planning for the future, our financial education content will help you make confident financial decisions.
- However, rest assured that our editorial content and opinions remain unbiased and independent.
- For example, both money orders and cashier’s checks are safe, reliable forms of payment.
But there are significant differences between the two that might determine which is best for your needs. For example, cashier’s checks have higher limits, but they are only available from financial institutions. Cashier’s checks can be obtained at banks or credit unions and sometimes online. A cashier’s check generally cannot be canceled or stopped after it’s issued. Cashier’s checks and money orders differ when it comes to payment amounts, fees and where you can purchase them. Cashier’s checks are best for purchases over $1,000, while money orders are meant for purchases under $1,000.
What’s the limit for a postal money order?
PNC Bank, for example, charges up to $10 per check depending on the account type. Why do some people hesitate before accepting one instrument or the other? Maybe, it’s traceability—bank checks always display your details, while money orders favor privacy. Or, perhaps, it’s about size limits—money orders often cap amounts around $1,000, limiting them for larger purchases. A single question—how much risk tolerance do you and your payee accept—guides your best choice. However, a cashier’s check may be more secure than a money order, as the money is drawn against your bank’s account, rather than your personal or business checking account.
For example, someone may send you a cashier’s check and then ask you to send back a portion via wire. The check will typically bounce, but not until after you’ve sent the wire, leaving you out of money. Cashier’s checks and money orders are two types of prepaid checks.
You can only send up to 1000 USD by money order within the US, and international money orders may be limited to 700 cashier’s check vs. money order USD.¹ You’ll also pay a small fee to issue your order. The information provided in these articles is intended for informational purposes only. All information presented is without any representation, guaranty, or warranty regarding the accuracy, relevance, or completeness of the information. A money order doesn’t have the recipient’s name explicitly on it, so it’s best to write it in the appropriate section as soon as you purchase it.
Sometimes, it needs translating with a bit of financial literacy. In situations where privacy, speed, or simple access matters, money orders frequently become the tool of choice, filling the gap between cash convenience and the guarantees banks provide. Have you ever weighed the satisfaction of handing over a check with your signature—your financial handshake—against the relief of knowing a money order can’t bounce? These everyday decisions reflect more than routine—they reveal your attitude to risk, privacy, and trust in financial relationships. Learn about the transfer limits at BMO and the fees that may apply.
Funds Availability
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Your signature travels with it, acting as a quiet promise—backed by your financial institution. You may also need to pay additional costs for your money order or cashier’s check, so make sure to confirm any charges before you send your payment. Money orders are considered very safe, as your personal details don’t appear on the order. This means it’s hard for someone to steal your information, such as your bank account number or routing number. This keeps your money safe until it reaches your recipient, and some lenders may ask for payment by cashier’s check to ensure a smooth transaction. If you’re deciding whether to send a money order vs cashier’s check, it’s important to think about the size and purpose of your payment.
One way to protect yourself is to confirm a cashier’s check with the issuing bank before completing the transaction, especially when dealing with someone you don’t know. A money order is essentially a prepaid check, a form of guaranteed payment. Money orders are much less expensive and can be purchased in more locations than can cashier’s checks.
Instead of relying on an individual’s available funds, the bank guarantees the check by using its funds. When you purchase a cashier’s check, you pay the bank the amount required plus any applicable fees. Some banks charge a fee to customers to issue a cashier’s check.
