When I was young I thought that money was the most important thing in life; now that I am old I know that it is.
~ Oscar Wilde
Today we’ll cover the fairly simple topic of how to buy a money order. Money orders have very often been called or still even sometimes called postal money orders or post office money order or even just postal order. The reason being, as you can imagine, because historically you purchased and cashed a money order from the post office.
However, things have changed tremendously and we now have a wide variety of options when it comes to purchasing and cashing money orders.
But before we get to the nitty gritty, we should perhaps first answer the question what is a money order? Well a money order is a payment order similar to a check except that it requires pre-payment for the specified amount indicated on the payment order. Because the amount indicated on a money order has been pre-paid it is a much more trusted method of money payment and exchange over a check.
There are many private companies that offer this service too, like Western Union and MoneyGram to name just a couple. Both of the aforementioned companies allow you to send money from the comfort of your home using the internet.
Because of that, there is one more company I’ll be looking at and that is PayPal.
Those of you who have an eBay account are probably familiar with PayPal as it is the preferred method of paying and receiving money from any online auctions there.
You’ve heard me talk about PayPal and MoneyGram before in when I wrote about how to use MoneyGram.
Okay, those are the 4 services I’ll be discussing in today’s articles. These are the most popular places if you want to know where to buy money orders. The USPS, Western Union, MoneyGram and PayPal. They all offer what could be considered money orders or at least ways to send money domestically or internationally.
So how do you buy a money order? Quite easily actually. If you’re choosing to use the USPS then you just head into any post office and ask to buy a money order. Tell the postal agent how much the postal money order is for and pay with it either in cash, credit card or traveler’s check. It is just that easy. As you can see, you can buy a money order with a credit card.
You will be issued a paper money order which will look something like a fancy check. The next thing you’ll need to do is to learn how to fill out a money order. This is easy and fairly self explanatory. To buy one you will fill out both you and the payee’s (the person’s who you will give the money order to) information including things like addresses, telephone numbers and perhaps even date of birth.
When you actually have the money order in your hand, filling it out is even easier. All you need to do is just put the payees information down which will be their name and address just like with a check and you can send it securely through the mail to whoever you bought it for. The person who is the payee of the money order will likely be required to show identification when they visit the post office to cash the money order. They can also if it is a domestic money order cash it at most banks and financial institutions.
There are a few reasons why I like USPS money orders. Firstly they are relatively cheap. They only cost up to $1.55 if sending up to $1,000US domestically. They also only cost $4.45 for sending up to $700US.
Now you can send $1,000 or more overseas, but you’ll have to buy an international money order for $700 which is the maximum face value allowed per international money order and you’ll have to buy another one for $300 so you’ll be paying the $4.45 fee twice.
You can send more than $1,000 domestically but you’ll need to buy more than one domestic money order as the maximum face value for a domestic money order is $1,000.
Secondly, money orders can be verified which means they are a great way of paying for a used car for example. Rather than bringing along $2,000 or $3,000 of cash when you got buy a used vehicle you can buy 2 or 3 money orders to give to the buyer and make it out to his name.
This way, he can call and verify the veracity of the money order at 866-459-7822 to confirm that they are legit and will be cashed. Then you can drive away in the car not having to worry yourself with carrying so much cash.
However, there is a drawback to using USPS money orders and that is they are not cashable all over the world. In fact there are only 29 other countries that will cash them. None of those countries include Europe, Asia (China, India) or Australia etc. In fact the countries that will cash them are a small circle surrounding the Caribbean Islands including Mexico and Canada.
I should mention that buying a money order from MoneyGram or Western Union is a similar process in person but Western Union at least has the additional benefit of being able to be bought online. So with WU you can buy money orders online. However, the fees for sending money orders online with Western Union for example are outrageous. To send $1,000 to China will cost you at a minimum $25 and as much as $81 depending on the speed at which you want to send it. This is just plain gouging.
The prices that WU and MoneyGram charge for sending money orders overseas when you use a location of theirs is around $9 to $11 give or take depending on where you’re sending it and how. This is for $1,000.
Those fees are better. But you can find even cheaper ways to send money online internationally. I use PayPal. Their fees just can’t be beat. For example if you are sending $1k to someone in China and you’re paying from either your PayPal balance or your bank account it is only $5. If however you are using a credit card you’ll be gouged $39, so that is something to bear in mind.
Their fees are also different depending on where you are sending the money too, so you’ll want to investigate that.
There is also a way to pay smaller fees and that is by letting the payee pay the fee. If you include it up front then it should all come out in the wash. This is how you can send money online as an international wire transfer as well as how to purchase a money order from the post office.