Cashier's checks cost more, but let you send more money. Money orders are cheaper and easier to buy, especially if you don't have a checking account.
Updated Feb 9, 2024 · 2 min read Written by Margarette Burnette Senior Writer Margarette BurnetteMargarette Burnette is a NerdWallet authority on savings, who has been writing about bank accounts since before the Great Recession. Her work has been featured in The Associated Press , USA Today and other major newspapers. Before joining NerdWallet, Margarette was a freelance journalist with bylines in magazines such as Good Housekeeping, Black Enterprise and Parenting. She is based near Atlanta, Georgia.
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Wealth psychology expert and coach Kathleen Burns Kingsbury, founder of KBK Wealth Connection and host of the Breaking Money Silence podcast, is an internationally published author and speaker. As an expert on financial psychology, Kathleen has appeared on television and her work has been featured in The New York Times, The Wall Street Journal, "PBS NewsHour," Money magazine, Today Money, Forbes and CNBC. Kathleen served as an adjunct faculty member at the McCallum Graduate School at Bentley University from 2009 to 2019 and currently teaches at Champlain College.
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Money orders and cashier’s checks can each be helpful if you need a more secure payment method than a personal check or cash — or if you don’t have a checking account. But they have some key distinctions.
The main difference between cashier’s checks and money orders is that cashier’s checks are better for larger purchases whereas money orders come in smaller amounts. Additionally, cashier’s checks tend to cost more while money orders are cheaper and easier to buy.
Use a cashier's check if .
Use a money order if .
Your purchase costs more than $1,000 You can afford to spend about $10 on the check You have a bank account and access to a financial institution You want a little more protection Your purchase costs $1,000 or less You can afford to spend $5 or less on the money order You don’t have access to a financial institution — or it’s more convenient to buy elsewhereHere's how to decide which works best for you.
Cashier’s checks are better for large purchases. Say you want to spend $5,000 on a used car, but the seller won’t accept a personal check. If you’re not keen on carrying large amounts of cash, you need another form of guaranteed payment.
In this case, a cashier’s check, sometimes called an official check, would be the better choice. Many businesses won't issue a money order for more than $1,000, but there's typically no limit on the amount a cashier's check can cover.
On the other hand, if you need to make a $500 deposit for an apartment and can’t use a personal check, a money order would be wiser because they're generally less expensive.
SoFi Checking and Savings
SoFi members with Direct Deposit or $5,000 or more in Qualifying Deposits during the 30-Day Evaluation Period can earn 4.50% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. There is no minimum Direct Deposit amount required to qualify for the stated interest rate. Members without either Direct Deposit or Qualifying Deposits, during the 30-Day Evaluation Period will earn 1.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Only SoFi members with direct deposit are eligible for other SoFi Plus benefits. Interest rates are variable and subject to change at any time. These rates are current as of 8/27/2024. There is no minimum balance requirement. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet.
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Min. balance for APYThese cash accounts combine services and features similar to checking, savings and/or investment accounts in one product. Cash management accounts are typically offered by non-bank financial institutions.
These cash accounts combine services and features similar to checking, savings and/or investment accounts in one product. Cash management accounts are typically offered by non-bank financial institutions.
Learn Moreon Wealthfront's website
Wealthfront Cash Account
Min. balance for APY Learn Moreon Betterment's website
Betterment Cash Reserve – Paid non-client promotion
*Current promotional rate; annual percentage yield (variable) is 5.50% as of 4/2/24, plus a .50% boost available as a special offer with qualifying deposit. Terms apply; if the base APY increases or decreases, you’ll get the .75% boost on the updated rate. Cash Reserve is only available to clients of Betterment LLC, which is not a bank; cash transfers to program banks conducted through clients’ brokerage accounts at Betterment Securities.
Min. balance for APYCDs (certificates of deposit) are a type of savings account with a fixed rate and term, and usually have higher interest rates than regular savings accounts.
CDs (certificates of deposit) are a type of savings account with a fixed rate and term, and usually have higher interest rates than regular savings accounts.
Read reviewMarcus by Goldman Sachs High-Yield CD
4.70% APY (annual percentage yield) as of 08/30/2024
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Federally insured by NCUA
Alliant Credit Union Certificate
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Annual Percentage Yield (APY) is accurate as of 08/20/2024
Checking accounts are used for day-to-day cash deposits and withdrawals. Checking accounts are used for day-to-day cash deposits and withdrawals.
Discover® Cashback Debit
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Deposits are FDIC Insured
Chime Checking Account
Monthly fee Money market accounts pay rates similar to savings accounts and have some checking features. Money market accounts pay rates similar to savings accounts and have some checking features.
Discover® Money Market Account
Money orders usually cost less. Walmart has some of the best prices for money orders, charging a maximum of $1 (exact costs can vary based on where you shop). The U.S. Postal Service charges from $2.10 to $3, depending on the amount. Banks often charge around $5.
Cashier’s checks in any amount will set you back around $10.
Some banks and credit unions waive fees on cashier’s checks and money orders for customers with certain accounts.
Money orders are easier to buy. You can buy money orders at post offices, some retail stores, banks, money transfer outlets and elsewhere. Going to a supermarket for milk? You could also pick up a money order at the customer-service counter.
Cashier’s checks, on the other hand, are usually available only from a financial institution where you're a member.
If you’re hoping to buy either one online, you won’t have much luck. Issuers often require that you visit a physical location to buy a money order or cashier’s check. If that’s not an option, you could ask your recipient to let you send money online instead. This is typically free with a bank account, and among peer-to-peer transfer services, Venmo doesn’t charge users for paying with a prepaid debit card.
Cashier’s checks can be a little safer. If you lose a cashier’s check or money order, or if it’s stolen, you can take steps to recover your money — generally by showing the issuer your receipt and asking for a refund. That makes either option safer than carrying cash.
However, on a money order, the purchaser fills in the receiver's name, which is similar to writing a check. (Learn more about how to write a check here .) If you lose the money order before filling it in, anyone could cash it. And once someone cashes that money order, you more than likely won’t get your money back.
If a money order or cashier’s check is cashed fraudulently, you could contact police and work through the legal system to try to recover the money.
Cashier’s checks offer a bit more protection, because the financial institution fills out the “pay to” line instead of the purchaser. And an official check drawn up by a financial institution may seem more credible to a recipient than a money order from your local 24-hour market. But either option is a good way to guarantee payment.
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