Cheapest Ways to Send Money

Send Without Spending

sending money
stefanamer/iStock

Sending money is easier than ever: you’ve got numerous choices, and the money can move more or less instantly. Sure, checks and cash have their advantages – people are accustomed to dealing with checks, and everybody knows how to spend cash. But there are other ways to transfer funds that are safer, faster, and easier to manage.

What if cost is a priority? Here are some of the cheapest ways to send money to another person.

Free Options

Venmo: It's free to send money with Venmo, and the app is designed to make it easy (and possibly even fun) to split expenses like meals, rent, and entertainment costs. Venmo will pull funds from your bank account or debit card for free, and you can also pay for free out of any balance stored at Venmo. There's a small charge if you fund a payment with a credit card. In addition to the payment feature, Venmo includes a social element. You can include a message explaining what each payment is for, and — if you choose — those messages can be posted to a newsfeed visible to friends. You can even comment on other friends' transactions, so the idea is to have fun and see what your friends are up to. Venmo is best used with people you know and trust. In the past, scammers have taken advantage of the laid-back nature of Venmo when selling online.

Square Cash: Square Cash lets you send funds from one checking account to another using debit cards.

There is no cost to use the service, and it is especially convenient if you want the funds to end up in your checking account anyway (because your debit card is linked to your checking account). To use the service, the sender and receiver both need to set up a Square Cash account and provide debit card numbers.

Once you’re up and running, making a transfer is as easy as using an app or sending an email. Learn more about sending money with Square Cash.

PayPal: You’re probably used to buying from online merchants with PayPal, but you can also send money to individuals. When making personal payments out of your PayPal balance or linked checking account, PayPal is free (you’ll only have to pay a fee if you send from a debit or credit card, and the recipient might pay a fee if the payment is considered a business payment). What about overseas payments? You can do that too, but PayPal charges a modest fee to send internationally.

Facebook Messenger: If you spend a lot of time on Messenger, Facebook Messenger payments are a convenient (and free) way to pay friends. To send or request a payment, you'll need to be friends on Facebook, and payments can be made using your browser or the Messenger app. Set up your payment account by adding debit card information. Once you're ready to send, start a conversation and select the dollar sign icon ("$").

Google Wallet: Google Wallet is another free option for personal payments. There’s no charge to send money from your Google Wallet account balance, linked checking account, or debit card (PayPal charges a fee if you use a debit card).

For Gmail users, sending money is especially easy. Once the money comes into your Google Wallet account, you can send it elsewhere, transfer it to your bank, or use a Google Wallet MasterCard for purchases and ATM withdrawals.

Online bill pay: If your bank offers online bill payment, you can often make payments for free. Just add a payee using the name and address of the person you want to send money to – it doesn’t have to be a business. Banks generally print and mail a check for you, so you won’t have to pay for postage or dip into your supply of checks. Of course, this is only “free” if you can avoid paying monthly fees for your checking account, and if your bank truly sends those payments at no charge.

Almost Free

Write a check: For the cost of a stamp, an envelope, and a check, you can send money the old-fashioned way.

The total cost is probably less than a dollar, and there’s no need to fiddle with a new online service. If you don’t plan to send money regularly, a check might be an easy one-time solution. If you’re using regular mail, be sure to do it safely, and keep an eye on your checking account to make sure the check made it to the right place.

Bank P2P payments: There’s a good chance that your bank offers a person-to-person (P2P) payment service. At some banks, those payments are free, but a fee of roughly $1 is not uncommon. Each bank probably has a unique name for these services; look for an option to “send money to a friend” or similar. Some institutions use a third-party service like Popmoney or Zelle.

P2P Payment Services: Besides the names above, numerous services offer P2P payments online and through mobile apps. Dwolla is just one example of an inexpensive P2P service, but new services become available regularly; some of them take off, and some don’t. With any banking service, it’s important to verify that you’re dealing with a legitimate business that won’t lose your money or your financial information.

Sending Online?

Online services make life easy, but there are a few limitations to watch out for.

Creating accounts: To use most of the services above, both the sender and recipient need to have an account. Creating an account is generally easy, but it might be inconvenient or undesirable (particularly for the recipient). Try to find a method that works for both of you (it might not be worth saving $1 if the recipient has to figure out how to create an account and get everything linked – just for a one-time payment).

Dollar limits: Inexpensive services often limit how much you can send, at least initially. Be aware of maximums (monthly or daily limits, for example), and find out what it takes to increase those limits. Some services allow you to send more after you request an increase and provide additional information about yourself.

Overseas payments: The discussion above focuses on sending money within the United States. If you’d like to send money elsewhere, be sure to research whether or not that’s an option and how much it will cost. PayPal often works for overseas transfers, and wire transfers (which cost more) or money orders are also an option.

"Alternative" Options

For better or worse, the methods described above are pretty mainstream: pretty much anybody can figure out how to accept a payment in short order, and fixing (or preventing) problems is relatively easy. However, there are other ways. Alternative currencies such as Bitcoin are an option, but alternatives are best for enthusiasts who truly understand the features and risks of those options.