Cashier Checks VS Money Orders: The Difference

Personal checks don’t work for everything. Some transactions require certified funds, which is why cashier checks and money orders are useful. 

Even though these third parties back your payment, you still want to pick the most secure. We’ll review the differences in price, limits, and protection.

First, why would you want to use any of them?

Unlike personal checks, money orders and cashier’s checks don’t require your personal information. You can send money without showing your checking account number, full name, phone number, or home address. You might not want to reveal that data to someone you don’t trust.

Despite both being anonymous, each of them has differences.

Cashier Checks VS Money Order

Cashier Checks VS Money Order

Let’s say you are preparing for a $2000 purchase. If you need the money right away, should you use one or the other?

Money orders won’t work well, because you can only “unlock” $200 on the first day. Plus, money orders have a $800 to $1500 cap. You could buy more than one, but if that’s your default payment plan, costs will add up quickly.

Cashier checks don’t have that problem. Because you have an account with your bank, they let you use $5,000 of your funds the first day. Hypothetically, there’s no limit on how big you make your transaction, as long as your account has that much.

Both methods still include hold times when you deposit the amount. Processing $200 may take less than a day, while volumes over $5000 can take over five business days.

A bank is more likely to hold your money if:

  • You just opened a new account with them.
  • The check is months old.
  • You send large amounts, especially when your account doesn’t have those funds.

After a check bounces, trying to deposit it again also leads to longer hold times.

Money orders give everyone the same maximum of $1000. Ten money orders of $1000 aren’t the same as one $10,000 check and may prevent longer hold times, but the cost could increase.


On average, it costs less than $2 to get a money order and around $10 to issue a cashier’s check. The first one has a limit, meaning you may need multiple money orders for a larger volume.

It’s all about your payment terms.

  • If you make an order for under $1000, money orders are fast and inexpensive.
  • If you plan to spend over $5000, cashier checks work better.

You may wonder. For someone handling that much money, does it matter to pick one method or another to save a few bucks? Mind that we choose cashier checks because of higher security.

Cashier Checks And Money Orders: Risks Involved

Risks Involved

Cancellation Issues

As a rule of thumb, you should never write checks except when necessary or as few as possible. If you start getting dozens of money orders, it becomes no different from handling cash. Can you really keep on track of so many papers?

Say a few of them get lost. The average cost to cancel a money order is $15 each. Canceling checks costs around $30, but at least you’re using a single one. If someone cashes your money order, you won’t be able to protect it in any way.

Missing Payments

Whenever you use these payment methods, make sure to be extra careful. Make a mistake, and it may take months to make a cancelation effective.

It may happen that the paper never reaches the recipient. The money order or check gets lost. So a stranger could use it to get money from you.

If you declare a money order as missing, it may take 30-60 days to receive the funds back, minimum. If you cancel a cashier’s check, it won’t happen until 90 days pass since your declaration. While it processes, your bank will still let deposit the check to whoever has it.

Although most see this slowness as a limitation, we should remember it exists for security reasons. Whenever you deal with fraudulent payments, for example, it helps to wait a few weeks to verify the amount.

Sending VS Receiving

Despite the cancelation issues, filling out a check/money order rarely has any complications. If you made a mistake and still keep the check, you can choose faster alternatives to cancelation: void the check or tear the document.

The problem appears when you’re the person receiving the amount.

  • You don’t know how long the amount will stay on hold.
  • Unless you consult on a call, you don’t know if the document is real.
  • The sender may not have the funds. If the check bounces, you pay those fees plus any money spent.

Receiving a check/money order can be risk-free if you wait a few weeks before you use it. It’s the easiest way to detect fraud since scammers urge you to pay them immediately. If it doesn’t clear or stays as Pending, assume you didn’t receive it.


When it comes to recurrent payments, costs can add up quickly. Instead of buying money orders every time, consider opening a bank account. You can send a voided check to set up an automatic electronic payment.

Both cashier checks and money orders can only do so much financially. Even though people use them all the time, they are inefficient compared to other conventional, faster, safer methods.

  • Compare with wire transfer and credit card payment.
  • Only use these methods when you trust the person.

How To Use Both Safely?

How To Use Both Safely

None of these methods are inherently risky if you know what you’re doing. Since cancellation costs money and a lot of time, it matters to do it right the first time.

If you don’t aren’t preventive, you’ll spend days stressing about: “How could I get it wrong with something so obvious?”

#1 Think twice before you do it

Before you send your check/money order: 

  • Inform about the possible fees and amount limits involved. 
  • Make sure the amount you write is available on your balance.
  • Only send it to the recipient if they plan to deposit immediately.

Waiting will increase risk, and you don’t want to be months waiting for a cancellation.

#2 Ask before you deposit

Instead of looking at the deposit as permanent, consider the money is not in your account, even if you hold cash. If it hasn’t cleared, it can bounce back, and you may need to pay for the fees.

Clearing takes weeks, but it doesn’t do anything to speed it up by calling the bank for a check-up. Tell them the ID number, and they’ll call back with the verdict.

If it’s genuine, then you can cash it, preferably as soon as possible. If not you can take a look at our banking fraud guide.

#3 Wait until it clears

A 3rd party can keep the amount on hold to prevent fraud. Unlike electronic payments, checks and money orders are physical pieces of paper. These may require pick-up, delivery, and manual revisions.

When using these methods legitimately, the issuer should have no problem with this delay. Scammers, however, want to make you skip this verification and take action. They want you to send them thousands, so then you owe that to your bank and face the fraudulent debt.

No matter what hook they use, anticipating this revision is simply not worth it.

#4 Keep it safe

It doesn’t take much skill to alter a piece of paper. If you know how the real document looks, you can mimic those features and then manipulate the filled-out information. A thief can modify the amount and who will receive it. 

When it comes to protection, checks prove more security due to restrictive endorsements. Yet, that doesn’t mean your bank will regard those, or that a thief cannot alter them.

Sometimes, security isn’t only about features. The question is: does the thief have enough time to react? Ideally, you want to send the paper the right after you fill it out, and the recipient should claim it as soon as they receive it.

If you send the wrong check, send a replacement. Tell your payee to either destroy or void the original one.

#5 Educate about check fraud

They say it’s easier for our brain to recognize something we’ve already experienced. Thus, being aware of the many payment scams already makes your finances more protected.

We cannot deny the countless fraud cases people deal with every year, whether it’s a bad check or a fake money order. Due to how popular these methods are, it’s a matter of time (and luck) that you cross with some of these con men.

The next time an opportunity catches your attention, make sure to check our complete guide about check fraud and money orders. Remember: they can only fool you as much as you let them.

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