If you need to send a payment, purchasing a money order or cashier’s check could be a better option than sending cash or a personal check. Either option helps keep your information secure and guarantees the recipient he or she will get paid.
Money orders are generally a little cheaper, and they can be much easier to buy, but there may also be a limit on how much you can send with a money order. Cashier’s checks, sometimes called bank checks, official checks, or teller’s checks, offer some added security and higher fund limits, but might cost you more.
Learn about the similarities and differences and when it might make sense to use a cashier’s check vs. money order.
They both provide some similar benefits:
Let’s start with an overview of how money orders and cashier’s checks are similar:
- You must prepay the amount when you purchase a money order or cashier’s check, which means you don’t need to worry about bouncing a check or overdrafting your account.
- Recipients appreciate that the funds are guaranteed by the bank, credit union, or store that issued the money order or cashier’s check.
- Neither will have your personal checking account information on it, which could help keep your information be more secure.
- Both could be more secure than sending cash through the mail because the recipient’s name will be on the money order or cashier’s check. It could also be cheaper than wiring money internationally.
- You don’t need a checking account to purchase a money order or cashier’s check, although it can be more difficult to buy a cashier’s check without one.
- You can generally purchase either with cash or a debit card. You may be able to use a credit card as well, but your card issuer could charge you a cash advance fee and interest on the purchase.
- It can be difficult to stop payment, cancel, or replace either one if it’s lost or stolen.
- Both can be forged, so be careful if someone tries to pay you with either option.
Now, let’s dive into a few of the differences to consider when choosing a money order vs. cashier’s check.
More stores sell money orders
You can buy a cashier’s check from a bank or credit union, although you may need to have an account there first. When you buy one, the cashier or teller will sign it, and the financial institution guarantees the check. You’ll need to know the recipient person’s or business’s name and the payment amount, so the teller can write in that information before signing.
While you may be able to buy a money order at a bank or credit union, you can also buy them at U.S. post offices, cash checking stores, money transfer agents, grocery stores, and retail stores, such as Walmart and 7-11.
You’ll fill in your information as well as the recipient’s information when you buy a money order. You may want to do this right away. Otherwise, if you lose the money order, anyone could fill in their name and cash it.
Money orders are usually cheaper
Although banks and credit unions may waive fees for some customers with premium accounts, you’ll likely have to pay a fee to purchase a cashier’s check or money order.
Cashier’s checks tend to be more expensive and can cost around $3 to $10 each. Some financial institutions will alternatively charge you a percentage fee based on the check’s amount.
You can buy a money order for under $2. For example, the U.S. Postal Service sells money orders for $1.20 or $1.65 depending on if the money order is for more than or less than $500.
You can make larger payments with cashier’s checks
There may be a limit to how much you can send using a money order. The exact limit depends on the seller, but it often ranges from around $700 to $1,000.
Cashier’s checks may not have a limit, which could make them a better option for large purchases.
Cashier’s check vs. money order: which is best?
Cashier’s checks and money orders can both serve useful functions, and one may be better than the other depending on the situation.
A cashier’s check may be best if you need to send over $1,000, as you may not be able to purchase a money order for that amount. This could be the case if you’re buying a car, putting a down payment on a home, paying rent, or moving and need to pay a security deposit.
A money order may be best for smaller payments, as you’ll likely save money on fees. Money orders may also be easier to buy, which could make them more convenient if you don’t have a checking account or live near a bank or credit union.