Money orders remain a popular way for consumers to make payments and send money securely without needing a checking account. In 2021, there were 230 million money order transactions with a total value of $74.8 billion in the United States according to the Federal Reserve. Many people rely on money orders for important expenses like rent, bills or sending funds to family. Leading pharmacy chain CVS offers money order services at most of its nearly 10,000 U.S. locations, but charges a $1.25 fee per money order up to $500. As a retail industry analyst and consumer advocate, I dug into the details of CVS money orders to help you determine if they are a smart choice for your needs and budget.
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How CVS Money Orders Work
Through a partnership with MoneyGram, a global money transfer and payment services company, CVS is able to sell money orders at all locations with a MoneyGram counter. To purchase a money order at CVS, you need to:
- Bring a valid, government-issued photo ID like a driver‘s license or passport
- Have the exact amount in cash to cover the money order amount plus the $1.25 fee
- Fill out the money order at the counter with the recipient‘s name, your info, and payment amount
- Keep the receipt to track the money order
One of the main appeals of getting a money order at CVS is the convenience and accessibility. Most CVS stores are open extended hours, if not 24/7, making it easy to get a money order when you need one. However, CVS money orders have some limitations to be aware of:
- Maximum amount of $500 per money order (you can purchase multiple in separate transactions)
- Cash is the only accepted form of payment (no credit/debit cards or checks)
- CVS does not cash money orders, only sells them
Compared to getting a money order at a bank, which may require an account and only be available during business hours, or a post office, which may have long lines, CVS can be a quicker and more flexible option.
CVS Money Order Fees and Value
Of course, that convenience comes at a cost. While $1.25 per money order may not seem like much, the fees can add up quickly if you use money orders frequently:
| Number of money orders | CVS fee | Total fees |
|---|---|---|
| 1 | $1.25 | $1.25 |
| 4 (per month) | $1.25 | $5.00 |
| 12 (per 3 months) | $1.25 | $15.00 |
| 24 (per 6 months) | $1.25 | $30.00 |
| 52 (per year) | $1.25 | $65.00 |
As you can see, purchasing one money order every week at CVS would cost you $65 per year just in fees. If you need multiple money orders per transaction, say for rent payments over $500, the fees multiply even faster.
So how does the $1.25 CVS money order fee stack up to the competition? Here‘s a quick comparison:
| Retailer | Fee (up to $500) | Max. Amount | Locations |
|---|---|---|---|
| CVS | $1.25 | $500 | 9,900 |
| Walmart | $0.88 | $1,000 | 4,700 |
| 7-Eleven | $0.65 – $1.00 | $500 – $1,000 | 8,500 |
| Kroger | $0.70 | $1,000 | 2,800 |
| USPS | $1.45 | $1,000 | 34,200 |
| Banks (with account) | $0 – $10 | Varies | Varies |
As you can see, CVS has one of the higher money order fees at $1.25, beaten only by USPS at $1.45 for amounts up to $500. Walmart offers one of the lowest fees at $0.88 with a higher $1,000 maximum amount, while some Kroger grocery stores charge as little as $0.70.
However, fees are not the only factor to consider. 7-Eleven may have slightly lower fees than CVS, but has fewer locations. USPS has the most locations, but may be less convenient than a 24-hour CVS. Banks can be the cheapest option, with some offering free money orders to account holders, but you likely need to be a customer and visit during business hours.
For some consumers, paying an extra $0.35 – $0.50 per money order at CVS is worth it for the convenience and flexibility. But if you are more price-sensitive or use money orders often, those fees can make a big difference over time.
Pros and Cons of CVS Money Orders
To help you weigh whether CVS money orders are the right choice, here‘s a summary of the key advantages and disadvantages:
Pros:
- Convenient with many 24-hour locations
- Reliable and trusted retailer
- Easy process with minimal requirements
- Familiar MoneyGram system and tracking
- Good option if you don‘t have a bank account
Cons:
- Higher $1.25 fee compared to many competitors
- Lower $500 maximum per money order
- Can only pay with cash
- Cannot cash money orders at CVS
- MoneyGram system can be a fraud target
Compared to getting a money order at Walmart, for instance, CVS may be more accessible, but charges a higher fee and lower maximum. 7-Eleven offers a lower fee, but only at some locations and with purchase of another item. USPS money orders cost more but are available at more post office locations.
According to a 2021 survey by Bankrate, 13% of U.S. adults purchased a money order in the prior 12 months. The most common reasons were: not trusting the recipient to cash a personal check (38%), recipient requested a money order (34%), and not having a checking account (24%). If any of those reasons apply to you, CVS money orders could make sense, especially if you have a location near you.
However, if you send money orders regularly and fees are a major concern, it may be worth adjusting your habits to get the best deal. That could mean opening a bank account that offers free or discounted money orders, or choosing a cheaper retailer like Walmart when possible.
As a savvy shopper myself, I try to avoid fees whenever possible. In the case of money orders, that usually means going through my credit union which offers them for free. However, I have used CVS money orders a few times when my credit union was closed and it was the quickest option. For me, the $1.25 was an acceptable price to pay for getting the money order quickly rather than waiting a day or two.
Expert Tips for Saving on Money Orders
If you want to minimize fees when purchasing money orders, consider these tips from personal finance experts:
Shop around. "Not all money order issuers charge the same amount. If you buy money orders frequently, shopping around for the best price could save you a lot of money in the long run." – Kimberly Palmer, Personal Finance Expert at NerdWallet.
Open a checking account. "One of the best ways to avoid money order fees is to open a checking account, since many banks offer free money orders as a benefit to their customers. Even if you only use the account for money orders, it could be worth it." – Andrea Woroch, Consumer Savings Expert.
Use a credit union. "Credit unions often have lower fees than banks, and many offer free or discounted money orders to their members. If you belong to a credit union, check to see what money order options are available to you." – Roger Ma, CFP.
Buy in larger amounts. "If you need to send a large sum of money, it may be cheaper to buy one large money order rather than several smaller ones. Just be sure to check the maximum limit and fees at each issuer." – Adam McCann, Financial Writer for WalletHub
Look for coupons or discounts. "Some retailers occasionally offer coupons or discounts for money order fees. For example, 7-Eleven sometimes has promotions where you can get a money order for free or at a reduced price if you buy a certain item in the store." – Julia Glum, Personal Finance Writer
Of course, money orders aren‘t the only way to send secure payments. Depending on your needs, a cashier‘s check from a bank, a peer-to-peer payment app like Venmo or Cash App, or even a wire transfer may be better options. But if you do need a money order, it pays to compare your options and find the most affordable and convenient choice.
The Future of Money Orders
While money orders may seem old-fashioned in our increasingly digital world, they remain an important financial tool for millions of consumers. According to a 2022 report by IBIS World, the money order and check cashing services industry brings in over $1 billion in revenue per year in the U.S. alone.
However, the industry is facing some challenges. Transaction volumes have declined in recent years due to increased competition from electronic payment methods and a shrinking unbanked population. The percentage of U.S. households without a bank account fell to 5.4% in 2021, the lowest rate since the FDIC began tracking the data in 2009.
To stay relevant, many money order issuers are investing in technology to make the process more convenient. For example, 7-Eleven launched a digital money order service in 2022 that allows customers to purchase and send money orders directly from the 7-Eleven app. Western Union also offers a mobile app for digital money transfers.
Still, many consumers prefer the security and simplicity of a physical money order. As long as there is demand, retailers like CVS are likely to continue offering the service as a convenience to customers. The key will be finding the right balance between price and value to stay competitive.
The Bottom Line
When it comes to purchasing money orders, CVS is a reliable and convenient option, but not always the cheapest. At $1.25 per money order up to $500, CVS‘s fees are on the higher end compared to competitors like Walmart and Kroger. However, the chain‘s wide availability and extended hours make it a popular choice for many consumers.
Whether CVS money orders are right for you will depend on your specific needs and preferences. If saving on fees is your top priority, you may be better off going with a lower-cost provider or finding a bank or credit union that offers free money orders. But if you value the convenience and security of a major retailer like CVS, the extra cost may be worth it.
Ultimately, being an informed consumer is the key to making smart money order decisions. By knowing your options, comparing prices and following expert tips, you can find the best way to send secure payments while keeping fees to a minimum.
