Definition
A prepaid paper payment you buy with cash or a debit card, used like a check when you do not have a checking account.
What it means
A money order is a paper payment for a set amount that you buy in advance from a post office, bank, grocery store or other seller. Because you pay up front, the person receiving it knows the money is there, unlike a personal check. Sellers charge a small fee and set a maximum amount per money order. Keep the receipt stub, which has a serial number you can use to track the payment or request a replacement if it is lost. Money orders are often used for rent, deposits and bills by people without a checking account. Since January 1, 2026, a 1% federal excise tax may apply when cash or a money order is used to pay for an international remittance transfer. Be careful with anyone who sends you a money order and asks you to send part of it back.
Example
Paying $900 rent with a money order that costs $1.75 to buy means you spend $901.75. Paying by check from a checking account usually adds no fee.
Illustrative numbers only. Your situation will differ.