Money orders offer a secure way to send payments, but how much do they cost? This article breaks down the fees associated with money orders, where to purchase them, and how they compare to other payment methods.
While money orders don’t accrue interest or expire, understanding their cost is crucial for budgeting. This guide provides a clear overview of money order fees from the United States Postal Service (USPS) and other common providers.
Where to Buy Money Orders and Their Fees
The cost of a money order varies depending on where you purchase it and the amount of the money order. Here’s a breakdown of common providers:
USPS Money Order Fees
The United States Postal Service is a popular place to purchase money orders. Their fees are structured as follows:
- Up to $500: $1.75
- $500.01 to $1,000: $2.45
Other Money Order Providers
Besides the Post Office, you can buy money orders at various locations, each with its own fee structure:
- Western Union: Fees vary by location and amount, generally ranging from $0.50 to $2.00.
- MoneyGram: Similar to Western Union, MoneyGram fees depend on location and amount, usually falling between $0.50 and $2.00.
- Walmart: Walmart offers money orders for a flat fee, typically around $1.00.
- Banks and Credit Unions: Many banks and credit unions sell money orders, but fees vary widely. Check with your local institution for specific pricing.
- Convenience Stores and Check Cashing Locations: These locations often sell money orders, but fees tend to be higher than other options.
Lost or Stolen Money Order Replacement Fee
If your money order is lost or stolen, you can request a replacement from the USPS. This involves a processing fee of $20.15. You will need your receipt to initiate the replacement process. Damaged money orders can be replaced for free at your local Post Office with the original receipt.
Why Use a Money Order? When is the Cost Worth It?
Despite the fee, money orders provide certain advantages:
- Security: Money orders are safer than cash since they are prepaid and require identification for cashing.
- Acceptance: Many businesses and organizations accept money orders as a form of payment, especially when personal checks are not accepted.
- Tracking: USPS money orders can be tracked online using their serial number, providing peace of mind.
Comparing Money Orders to Other Payment Options
Consider these alternatives and their associated costs:
- Cashier’s Checks: Issued by banks, cashier’s checks are more expensive than money orders, usually costing around $10-$15.
- Personal Checks: While free to use, personal checks require a bank account and can bounce due to insufficient funds.
- Debit Cards: Debit cards offer instant payment and are typically free to use at point-of-sale, but may incur fees for ATM withdrawals.
- Online Payment Services: Services like PayPal or Venmo offer convenient digital payment options, but may charge fees for certain transactions.
Conclusion
The cost of a money order is generally under $2.50, making it an affordable payment option for many situations. While other methods exist, money orders offer a secure and widely accepted alternative to cash or personal checks. Weighing the cost against your specific needs will help you determine if a money order is the right choice. Remember to factor in potential replacement fees if the money order is lost or stolen.
