A major problem with using money orders regularly is cost. If you need to buy one from time to time, it’s not a big deal. However, some people use money orders instead of checks because they don’t have a checking account. Free checking still exists, but it’s harder to find. Even if you have to pay for checking, you’ll most likely save money if you buy more than a few money orders each month.
Money orders will not suffice in some situations because of maximum limits. For example, you may not be able to find anybody who can issue a money order for more than $1,000. What if you need more than that? You can use multiple money orders. However, the cost to do so may make a checking account or cashier’s check more attractive.
You can buy money orders at numerous locations: post offices, retail stores, banks, etc. However, you often have to visit in person and bring cash. If you have a checking account on the other hand, you can just write a check whenever it’s convenient. Better yet, you can use your bank’s online bill payment service and save a check.
Assuming you don’t need to use a money order for security purposes, checking accounts are much more convenient. You also get other benefits like the ability to review and download transactions so you can track your spending.
Money orders are often considered safe. Sellers count on the issuer -- instead of you personally -- to deliver funds. However, they can raise red flags because they’re often used for fraud. In some cases, money orders are prohibited or they cause extra administrative work and delays. For example, some financial institutions (like insurance companies) don’t accept money orders because they can be used in money laundering operations.