A money order is your best option if you need to pay a bill or an individual but do not want to carry cash or use a bank check or credit card to do the transaction. A financial institution is given instructions on this paper to pay a particular sum of money. If you know how to fill out a money order, it will be much easier for you to make or receive funds on time.
What kind of information should be provided on a money order?
The conditions for filling out a money order slightly vary from one issuer to the next. For instance, money orders issued by the United States Postal Service (USPS) and those by Western Union have different formats.
You can get a money order from the post office or a financial institution. However, purchasing a money order is very similar to writing a check. You will typically be required to have the following pieces of information at hand: the payee's name, the payment amount, the payee's address, and any other pertinent particulars, such as an account number.
When purchasing a money order, you will also need to carry a valid form of payment with you. Cash, traveler's checks, and debit cards are all common forms of payment accepted by most issuers.
The process of completing a money order
When you buy a money order, you will be required to provide the amount to the entity issuing the money order. That sum will already be written down on the paper document you receive, so you are not required to fill it in.
On the other hand, to correctly complete a money order, you will be required to submit the following information:
- Name: Make sure to include the complete name of the individual or company receiving payment from your money order. In addition to that, certain issuers require that the purchaser's name be entered into a field titled "From." This field's label could be "Pay to the order of," "Pay to," or "Payee," depending on the context. Suppose you leave this section blank or make the money order payable to cash. In that case, anyone will be able to cash it, and you run the risk of having the funds taken from you if the money order is lost, stolen, or destroyed.
- Address: Some money orders will have a space for you to fill in with your current mailing address if the receiver has to contact you regarding the payment. On the other hand, if you are concerned about maintaining your anonymity, you might be able to leave out this information. Inquire about the requirements with both the company issuing the money order and the beneficiary. Both the address of the recipient and your address are printed on USPS money orders since they include two address fields. One is on the left for the recipient's address and another on the right for the purchaser's address.
- Additional information: You may be required to enter additional information on the money order to process the payment correctly. This field may have "Re:" or "Memo" assigned to it. This may contain your account number, specifics about the transaction or order, or any other notes that would assist the recipient in understanding the motivation for the payment. If there isn't a designated space for additional information, you should write it down on the document's cover.
- Signature: Some money orders demand a signature. On the front of the document, you should search for a field that is labeled "Signature," "Purchaser," or "Drawer." Do not sign the document on the reverse because the recipient will be required to sign there to endorse the money order.
Suppose there is an issue with your payment. In that case, you should save all receipts, carbon copies, and other documentation that you receive when making a purchase even after you have completed the filling out of your money order. You may need these documents to cancel the money order, and they can also come in handy if you need to trace or confirm a payment.
The maximum amount paid with a single domestic money order is usually around $1,000.
Using money orders – what are the pros and cons?
The advantages of using money orders
Money orders provide a reliable and risk-free method of transaction for purchasers. You can mail a document with the ability to track its delivery and ensure that the intended recipient can only cash it. In contrast to checks, money orders enable you to maintain the confidentiality of specific information, such as the number of your bank account. They can also be beneficial for transactions that do not permit the use of checks as a form of payment.
Suppose you need to purchase and fill out a money order. In that case, you can get one at various locations, including the post office, financial services organizations like Western Union, retail outlets like Walmart, or a traditional bank. You can also get one online. You can purchase them at most stores for less than a few dollars. However, the prices at financial institutions like banks and credit unions are often more.
Money orders are often a reliable and risk-free mode of payment for merchants. To prevent it from being returned unpaid as a personal check, purchasers of money orders must pay with cash or a cash equivalent.
Some card issuers will let you use a credit card to pay for a money order. Still, they will likely label the transaction as a cash advance and hit you with costs associated with cash advances and high-interest rates.
The disadvantages of using money orders
Before these recent years, money orders were a standard and low-cost mode of payment that was widely used. However, in recent years, new payment methods based on fintech, such as Zelle and Venmo, have arisen. Compared to money orders, these options are more convenient, less expensive, and quicker. Therefore, you might consider looking into many different methods of payment. Because of the amount constraints and expenses associated with issuing money orders, it may be necessary to utilize many money orders to pay for large transactions. In this scenario, a cashier's check is likely to be the most convenient payment method.
Similarly, money orders are not a suitable replacement for a regular bank account. A regular bank account allows you to create your checks and use a debit card. In contrast to payments made using checks or debit cards, money orders require you to pay a fee each time you make a payment. Thus, money orders are more expensive to use for frequent transactions.
Similarly, money orders can be falsified and used in typical internet scams. Therefore, you need to be sure that you fill them out according to the directions and that any monies you receive clear your bank before you spend them.
Frequently Asked Questions (FAQs)
Where can I get a money order in the area?
You can obtain money orders from many establishments, such as the post office, banks, Western Union, shops, grocers, and pharmacies.
How much does it cost to get a money order?
The cost of a money order can range anywhere from a few dollars to tens of dollars, depending on the service provider and the size of the money order.
How do you cancel a money order?
If you misplace a money order, the company that issued it will allow you to get a refund. Get in touch with them to provide information about your money order, and then follow the cancellation steps. In most cases, you will be required to fill out a cancellation form and pay a charge. In addition, you will have the option of requesting a cash refund or a replacement money order.