In Venice, the jetset pay out for fancy restaurants and private launches but our tips mean you can enjoy the same views and (probably) more authentic food and drink for a fraction of the cost

Snack … all the time

If you're happy to swap a sit-down meal in a restaurant for a stand-up snack, you can save a fortune – as well as getting a chance to rub shoulders with the locals. A proper Italian breakfast is cheap and fast – coffee and a pastry knocked back standing at the counter of a pasticceria. Da Bonifacio (Castello 4237, Calle degli Albanesi) is moments away from the tourist heave of the San Marco ferry terminal, hidden down a crooked passage to the left of the Danieli Hotel. Order an espresso and a sweet, comforting tortino di riso, a pastry filled with rice pudding, fresh from the oven.

At lunchtime seek out one of the many bacari that pepper the city. These are small bars that serve ciccheti (tapas-like snacks for €1-€2). As well as being a fantastic way to fill up cheaply, they're usually full of locals: stylish, loud, downing prosecco and crostini topped with paper-thin prosciutto or creamed salt cod. You can find a bacaro on most corners, but we loved All'Arco on Calle Arco, which is full of old men and ladies with tiny dogs, and Alla Vedova on Ca D'Oro, where we tucked into delicious polpette (meatballs) and tiny glasses of vino bianco poured from a porcelain jug on the bar.

Join the traders

Fish stall at Rialto market. Photograph: Paul Williams (Funkyfood London)/Alamy

Venice's most important food market, the Mercato del Rialto, is at its most bustling early on Friday and Saturday, when locals and chefs are loading up with ingredients for the weekend. Wander among stalls piled with bundles of bright, shiny chillies, swordfish and glistening, inky-black squid. Shop for prosciutto, cheese, bread and fruit for a picnic or pop in to one of the traders' bars, such as Al Mercà, (213 San Polo, Fondamenta Riva Olio) for an 11am bruschetta and glass of prosecco. It's how the traders like to roll – when you're up at 4am, booze o'clock comes early.

Take the 'bus'

To appreciate the impossible dreamlike beauty of Venice, you have to get out on the water. Private water taxis cost over €100 but the more affordable vaporetti (waterbuses) can take you all over the lagoon. Line 2 travels the Grand Canal, making fewer stops than Line 1, so is usually less crowded; it then loops round to Giudecca, giving you a scenic tour for around €6. Even better value is buying a travel card (€25 for three days) which takes you on ferries to all of the islands.

Hit the beach

By the seaside … one of Venice's beaches (naturists not pictured). Photograph: Michael Sick/Getty Images

When you're stomping through Venice's hot streets all day, the desire to jump in to one of the canals can be overwhelming. Do not do this: the water is stagnant and filthy. Instead, take the vaporetto to the Lido then hire bikes at Lido On Bike (Gran Viale Santa Maria Elisabetta, 21/B, from €5) and head down the island to Alberoni beach, the last one along. It's a nature reserve (warning: it also welcomes naturists), and is the wildest part of the lido with dunes, drift wood and plenty of sea birds. Trattoria al Ponte di Borgo, a rustic restaurant in Malamocco, a short walk or bike ride from Alberoni, is a good spot for an affordable meal.

Drink

Enjoying a a spritz in a Venice bar Photograph: Alamy

Dining out in Venice is expensive so it comes as a surprise to discover that drinking is incredibly cheap, which may explain why locals can often be spotted with a glass in hand from 10am. A glass of prosecco, which is a local speciality, or a spritz (a mix of prosecco and Aperol or Campari) cost us no more than €2.50 in any bar. Go north to Canareggio, a peaceful, local district, and do a mini bar-crawl along Fondamenta degli Ormesini stopping at highly-rated Caffe Dodo and Al Timon.

Escape the touristy centre

Campo Santa Margherita in Dosoduro. Photograph: Alamy

Your money goes much further if you can escape the centre and head into one of the city's residential neighbourhoods – which is fun to do without a map; more than any other city, there's a surprise on every corner in Venice.

Wander through the Rialto market, with the Grand Canal on your right, into Santa Croce, a vibrant quarter. Osteria La Zucca near Campo San Giacomo does tasty, affordable vegetarian food, and Alaska Gelateria (Calle Larga dei Bari) does a mean fig ice-cream. Next, go south into the Dorsoduro, where we stumbled on the Church of San Barnaba (which appears in Indiana Jones and the Last Crusade), where there was a lively flea market going on outside, and as an added bonus there was a lively flea market going on outside.

We also discovered Campo Santa Margherita, a bustling student square, with affordable places to eat and drink. We settled down with a platter of cured meat and glasses of prosecco in Osteria alla Bifora (Campo Santa Margherita 2930), a bar in a former butcher's shop.