December 29, 2008

Quick and cheap ways to send money

This past week we had an urgent electrical problem with a rental property that we needed to get fixed as soon as possible. The property is out of state and ran by a property manager. Before we could get the repair done we had to send them some money up front to cover the cost. So we had to find a way to get them money fast. Of course I also wanted to find a cheap way to do it. I looked at Western Union but to send money instantly it was going to have a fee over $20. We ultimately ended up depositing money into their account but had to do it with cash. I would have liked to just used Paypal but that money isn't instantly available outside Paypal generally.

So here are a few options on sending money fast and cheap:

Use Paypal : Free & instant

You can send money to anyone else instantly via a Paypal account. The money will go into their Paypal account. This is generally free for personal use. The money isn't instantly available to use however so if they need to have it in cash or their bank account it would take 3-5 more days to transfer the money from Paypal to a bank account.

Deposit cash into an account : Free & Instant

To deposit cash into someones account you will need to know their bank account number. Generally people wouldn't want to give their bank account out to just anyone so this method probably works best with friends and families or trusted business associates. To use this method you just go to the local bank branch where the other person has an account and make a deposit just like you'd make a deposit in your own account. Its key to use cash to make the deposit however, since if you try to deposit a check they'll have to wait for the check to clear which can take days.

Mail a money order : Cheap & takes a few days

This is not a super fast way to get money to someone but if they can wait 2-3 days then it is fairly cheap and works just fine. If you send a money order then there is no worries about a check clearing and the money is quickly usable. Many places offer money orders for 50¢ and then the cost of a stamp puts you at less than $1 total.

If one of the above options won't work then you might just want to wire the money. Western Union is the first option I thought of but there are other, cheaper alternatives to wire funds:

MoneyGram : fee & instant

MoneyGram service lets you wire money instantly and they have many locations. Locations include banks and grocery stores as well as some 7-Eleven branches. You can go to a location and send money or send it online. Online fees seem a bit higher. At a location their website cited a $12 fee for $100 or $15.49 online. By comparison Western Union fees would be $16 in person or $20 online. You can also use MoneyGram to send money safely overseas to many locations internationally.

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