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Money orders take away any doubt that the payment is good. Most creditors charge a hefty fine if they have to send back a bounced check.ĭepending on the timing, your payment could also be considered late by that point, causing you to incur even more fees. That also saves you from worrying about having to pay a fee for insufficient funds. Rather than run the risk of having a check bounce, a money order is prepaid and guaranteed, so both you and the recipient know that it won’t bounce. Money orders also offer several perks and safety features that you may not find with other forms of payment. This flexibility makes a money order an easy, convenient way to transfer money. Then, you either get the cash or deposit the funds into your bank account. You simply need to sign it and provide a valid photo ID. You may also be able to cash your money order at other retailers like grocery stores or check-cashing locations. You can cash money orders at a bank or credit union just like you would a check. For instance, some bills take a while to be cashed, and you might be worried about keeping track of pending payments in your bank account. You never have to worry about it being lost or stolen and then having to make the payment a second time.īut you might find it beneficial to use a money order even if you have a bank account. Using a money order protects your payment from the time you drop it in the mailbox until the recipient deposits it. It’s difficult to pay online without a credit or debit card, and sending cash in an envelope can be risky. In fact, nearly 8% of all American households don’t have a bank account. Most importantly, it’s a safe and efficient way to pay bills if you don’t have a checking or savings account. Using a money order can come in handy for several reasons. It usually costs just a few dollars or less, but the charges vary depending on where you buy it. When you buy a money order, you pay the amount you want it to be worth in addition to a small processing fee. Most money orders only cost a few dollars, so it’s a relatively inexpensive way to send secured funds as needed. The key difference is that money orders are safer than personal checks because a third party guarantees the funds, typically whoever you bought the money order from. Similar to a check, a money order functions as a prepaid payment method where both you and the recipient must sign for it to be cashed or deposited. Read on to find out what exactly they are, why you might want to use one, and how the process works. While money orders might seem a little outdated, they remain a strong option for many individuals. Money orders are a safe and convenient way to send money. Taking care of your financial obligations is important, but it can be difficult if you find yourself in a situation where a check or cash won’t do the trick.