Sixty-seven countries. Eleven years on the road. And people still tell me South America is expensive, dangerous, impossible on a backpacker’s budget. I hear it in hostels from Lima to La Paz, usually from someone who just paid $40 for a dorm bed in a tourist trap and wrote off the whole continent. Wrong. Dollar for dollar, South America has given me some of the best value travel of my life. Three-course lunches for two bucks in Bolivia. A free hammock on a Colombian beach. Bus rides across the Andes that cost less than a sandwich back home. It takes planning and a willingness to slow down. Do those two things and this continent hands you experiences that would cost ten times as much anywhere else.
My first week in Peru, I was in Cusco, altitude 3,400 meters, lungs on fire, checking into a hostel that wanted 90 soles a night. Green as they come. A guy in my dorm, an Argentine named Tomás, watched me hand over the cash and just shook his head. He walked me two blocks downhill to a family-run place with a courtyard, hot water, and a private room for 35 soles. “You’re paying gringo tax,” he said. That afternoon, over a 6-sol menu del día, he taught me how to ask “¿Cuánto cuesta?” without sounding like a walking ATM. That one conversation saved me hundreds over the next three months.
Why This Matters
South America is the cheapest continent to travel well. Not just cheap — cheap and spectacular. You can hike to Machu Picchu, stand under Iguazú Falls, sail the Galápagos on a last-minute deal, and eat like a king, all for less than a month’s rent in most Western cities. The money you save isn’t the point. The point is that your budget stretches into time. More days. More places. More chances to say yes to something you didn’t plan. That’s the whole game.
Here’s an opinion that’ll annoy some people: skip the hostels in the big tourist hubs. In Cusco, Medellín, and Buenos Aires, private rooms in family-run hospedajes often cost the same as a dorm bed in a party hostel. You get more sleep, more privacy, and you’re actually supporting local families instead of international chains. I’ve done both. The hospedaje wins almost every time.
Top 5 Tips
1. Take the overnight bus, always. In Peru and Ecuador, a 10-hour night bus costs $15–25 and saves you a night’s accommodation. The seats recline, they show movies, you wake up in a new city. Bring a hoodie — they blast the AC like it’s a meat locker. In Argentina and Chile, buses are pricier but still beat flights once you add airport transfers. Book at the terminal, not online, and you’ll usually pay less.
2. Eat the menu del día at lunch, not dinner. Every country has its version. Peru calls it menú, Colombia calls it almuerzo corriente, Bolivia calls it almuerzo. Soup, a main with rice and meat, sometimes a small dessert, and a juice. Costs $2–5. The same food at dinner is double. Locals eat their big meal at midday. Do what they do. Restaurants in Bolivia and Peru often close their kitchens by 9pm anyway, so a late dinner isn’t even an option in smaller towns.
3. Withdraw cash in big chunks, and never at the airport. ATMs in South America charge brutal fees — $5–8 per withdrawal in some countries. Take out the maximum your bank allows, once, in a city. Airport ATMs are the worst. Carry small bills, too. Nobody can break a 100 in a village market, and you’ll end up buying something you don’t want just to get change.
4. Learn the bus terminal dance. Walk past the first three touts who grab your arm. Go to the official company counters inside the terminal. Compare prices for the same route. In Peru and Bolivia, prices vary wildly between companies for identical buses. I once paid 40 soles for a Cusco–Puno bus that another company was selling for 80. Same road, same time, same uncomfortable seat. Ask around before you commit.
5. Travel in shoulder season, and go north when it’s south’s winter. January in Patagonia is a zoo and prices spike. June in Colombia’s coffee region is green, quiet, and cheap. Flip your itinerary to follow the dry seasons, not the tourist calendar. You’ll save 20–30% on accommodation and actually get a seat on the trail.
Budget Breakdown
Real numbers from my last long trip through Peru, Bolivia, and Colombia. All in US dollars, per person, per day. I’m a mid-range backpacker — I take buses, eat local, stay in private rooms when they’re cheap, and splurge on one big thing a week.
- Accommodation: $8–15 for a dorm, $12–25 for a private room in a hospedaje. Bolivia is the cheapest, Colombia the priciest of the three. Book the first night, then walk around and ask.
- Food: $8–12 per day. That’s a market breakfast, a menu del día lunch, and a light dinner or street food. Add $3–5 if you drink beer most nights.
- Transport: $5–10 per day averaged out. Overnight buses are the workhorse. Local colectivos and chicken buses are pennies.
- Activities: $10–20 per day averaged. Machu Picchu entry is around $50, the Inca Trail is $500+, but most hikes, ruins, and museums are under $10. Many are free on Sundays.
- Total: $35–55 per day. I’ve done it on $28 in Bolivia and $70 in Colombia when I wasn’t paying attention.
That’s it. A month in South America on $1,200–1,600 is entirely doable. Less if you volunteer or house-sit. More if you drink like a sailor. Your call.
One Mistake to Avoid
Do not, under any circumstances, change money on the street. I did it once in Lima, at 11pm, because I’d run out of soles and was too tired to find an ATM. The rate looked great. The guy counted the bills twice, smiled, handed them over. I got back to my hostel and found the middle of the stack was cut newspaper. Lost about $40. Not catastrophic, but it stung, and it was entirely avoidable. Use ATMs inside banks during the day. Use official casas de cambio. If someone approaches you on the street with a better rate than the bank, that’s not a deal, that’s a lesson waiting to happen. I got off cheap. I’ve met travelers who lost hundreds.
One more thing, since I’m being honest: don’t over-plan. I used to arrive in a city with a spreadsheet. Now I arrive with a rough direction and a hostel for two nights. The best stuff — the Argentine guy who taught me about gringo tax, the Bolivian family who fed me soup when my bus broke down, the Colombian fisherman who took me out on his boat for the price of a beer — none of it was on the spreadsheet. South America rewards the traveler who leaves room for the unexpected. So leave room. Book the flight, pack light, learn ten words of Spanish, and go. The continent will meet you halfway. It always does.