If you don't have a checking account or don't want to send a personal check to somebody, you can purchase a money order at many banks, the post office or inside some supermarkets. Money orders are secured checks; you pay for the check upfront, plus a fee and the recipient cashes the money order at his bank. Money orders don't necessarily expire, but banks may follow the same rules for cashing them as for cashing checks.
Always consult with your bank in order to determine if any specific expiration rules apply to your money order.
Issuer Guidelines to Observe
There are no federal laws limiting the amount of time a money order is good for. However, the company that issues the money order may impose limits on how long the money order can be used. For example, Fidelity Express charges a service fee if a customer cashes a money order that is more than two years old. If the issuer issues a monthly service charge for each month past the deadline, the money order might not be worth anything after a certain period of time.
Important Bank Obligations
The Uniform Commercial Code says that banks do not have to cash checks that are more than six months old unless the check is certified. Thus, banks have the discretion to refuse to cash a money order that is more than six months old, even if the issuer does not put any expiration date on the money order at the time of issue.
Scams and Important Warnings
If someone contacts you saying he found an old money order and wants to give you a percentage of it in exchange for cashing it, do not agree to do so. This is a variation of an advanced-fee scam, which the scammer offers you "free" money and then continually asks you to pay fees or other costs prior to receiving your money. In addition, some scammers ask you to cash a money order for a larger sum of money than the scammer owes you and keep the difference. If you fall for this scam, you might end up liable to your bank for the full cost of the money order or face charges of wire fraud.
Other Critical Considerations
When you purchase a money order, you pay the money upfront plus a small fee. Thus, you cannot stop payment on a money order as you would on a check, and you have little recourse if the person who receives the money order does not give you goods or services in exchange for the money. In addition, if someone steals the money order and cashes it, it may be more difficult for you to get your money back or get a replacement money order than if you used a check.