South and Central America are sometimes forgotten by residents of the rest of the world, but savvy travelers continue to flock to this region for a great variety of reasons. In addition to the cultural and scenic highlights, the entire area is quite cheap by international standards, at least once you are here. Backpacking in South America can be very inexpensive and 3-star travel can be surprisingly affordable as well.

We have completed updated this list for 2020 and re-ranked each destination from cheapest to most expensive. Most currencies in the region were pretty stable in 2019 and inflation was very low in all but a couple of countries, so things remain great value for most travelers. Argentina continues to struggle with runaway inflation, but its currency keeps going down so it's actually a very good bargain as of 2020. Venezuela is out of control and probably better saved for a future when things are stable.

How the Backpacker Index works

Prices for most things are fixed and certain, but prices for a “budget lunch” or a pint of beer can vary depending on whom you ask. Still, our estimates are based on a lot of research, and should be very close if not right on.

Costs for each city

One night in the cheapest bunk at the least expensive hostel with a good location and good reviews

Two public transportation rides per day

One paid/famous attraction per day (Every city is loaded with free things to do for budget-conscious travelers, but here we take the average cost of a major attraction in each city for each day.)

Three “budget” meals per day.

Three cheap, local beers each day as an “entertainment fund.” Non-drinkers might have dessert and coffee or attend a local music performance instead, so this is a general benchmark that should be proportional for each city.

Price of Travel's South & Central American Backpacker Index for 2020

Note: All prices converted to US dollars in January, 2020

This high-altitude city with some of the world's most consistent weather is an excellent travel bargain. Unfortunately, it's not too easy to reach, so it tends to get most visits from people touring the whole region. Those who make the effort will be rewarded with spring-like weather all year, and very low prices for almost everything. As with most other places on this list, once you get outside the biggest city the prices tend to be even lower.

Currency: US dollar

Best cheap hostel: Color House Petite – 5.00/night

Transportation: 0.50

Meals: 10.80

Drinks/Entertainment: 4.50

Attractions: 2.00

Daily Backpacker Index: US$22.80/day

>>>Quito prices and weather

While Managua is the crowded capital of Nicaragua, Granada is arguably its top tourist destination for foreign visitors and backpackers. This colonial town is one of Central America's best tourism bargains, with prices noticeably lower than in similar colonial towns in neighboring countries. There aren't many hostels here yet so it's wise to book ahead even though the existing hostels are quite cheap. There is a lot to see in Nicaragua and several other colonial towns worth visiting between the natural sights.

Currency: Nicaragua Cordoba

Best cheap hostel: De Boca en Boca – 270/night

Transportation: 30

Meals: 306

Drinks/Entertainment: 120

Attractions: 100

Daily Backpacker Index: NIO826 = US$24.55/day

>>>Granada prices and weather

Speaking of high altitude, La Paz is in a similar situation to Quito (above) with its climate, and it's also very cheap for tourists by international standards. Of course, once you get outside the big city, prices tend to be even lower, but in this part of South America the tourist infrastructure can be lacking unless you are in the popular cities.

Currency: Boliviano

Best cheap hostel: Wild Rover Hostel La Paz – 56.40/night

Transportation: 4.00

Meals: 82.80

Drinks/Entertainment: 18.00

Attractions: 15.00

Daily Backpacker Index: BOB176.20 = US$25.54/day

>>>La Paz prices and weather

Colombia has been riding a tourism wave for the last few years, and that seems likely to continue. In addition to it now being mostly safe, this country is a fantastic value for most foreigners. Cartagena is its main tourist hub, as it offers a gorgeous walled Colonial town not far from some pleasant Caribbean beaches and a cruise port. This is the best value Caribbean beach destination, as long as you don't need white sand. If you are looking for mild weather and far fewer tourists you might also head to Medellin.

Currency: Colombian peso

Best cheap hostel: Hostal Santo Domingo Vidal – 29,576/night

Transportation: 4,600

Meals: 33,240

Drinks/Entertainment: 12,000

Attractions: 20,000

Daily Backpacker Index: COP99,416 = US$30.60/day

>>>Cartagena prices and weather

Only highlighting San Jose in Costa Rica on this list is a bit unfair, mostly since few tourists spend more than one night here on their way to the beach or resort cities elsewhere in the country. Budget travelers can do well in Costa Rica if they are careful, but generally it's more expensive than anywhere else in the region, and things like canopy tours or surfboard rental can add a lot to the cost of a visit. Still, Costa Rica tends to be the safest and best organized country in Central America, so it's the best choice for many. If you are looking for more of a mid-priced beach area you might consider flying into Liberia Airport and visiting the Guanacaste region.

Currency: Costa Rican colone

Best cheap hostel: Fauna Luxury Hostel – 4,600/night

Transportation: 500

Meals: 6,000

Drinks/Entertainment: 3,000

Attractions: 4,000

Daily Backpacker Index: CRC18,100 = US$31.70/day

>>>San Jose prices and weather

Those planning to see the amazing Machu Picchu ruins will start their trips in Cusco, so fortunately this is a great tourist town in its own right. There's plenty to see and do in the city and in the general area, and there's almost no end to the amount of affordable accommodations available. With most things being as cheap as they are, this is a wonderful town to just chill out in for a while if your schedule permits. Be aware that the train from Cusco to Machu Picchu and Machu Picchu admission are VERY expensive compared to everything else. Hostels here are plentiful and strangely cheap, so many people stay on longer than they originally planned.

Currency: Peru nuevos sol

Best cheap hostel: Atawkama Hostel – 21.40/night

Transportation: 4.00

Meals: 24.00

Drinks/Entertainment: 12.00

Attractions: 40.00

Daily Backpacker Index: PEN105.40 = US$31.84/day

>>>Cusco prices and weather

Lima can be a surprising city to many who first visit, with lots of great colonial architecture combined with a vibrant big-city nightlife scene and a European-style way of life. The Miraflores suburb just on the coast is where you'll find most of the hotels and guesthouses, and fortunately things there are still quite cheap in spite of the slightly posh vibe. Lima is a good base to launch trips to Machu Picchu among many other worthwhile sights in this underrated country.

Currency: Peru nuevos sol

Best cheap hostel: Alpes Lima – 28/night

Transportation: 3.00

Meals: 26.40

Drinks/Entertainment: 18.00

Attractions: 30.00

Daily Backpacker Index: PEN105.40 = US$31.84/day

>>>Lima prices and weather

Similar to most other Central American countries, the largest city (San Salvador) is not the best tourism destination compared to the smaller Santa Ana. This is another colonial city that is friendly and easier to deal with than the capital, and it's easier to find English speakers here as well. Santa Ana is another travel bargain by international standards. Other smaller towns in San Salavador will generally be even a bit cheaper. Stay current on safety warnings before you go because this country is not among the safer ones in Central America.

Currency: US dollar

Best cheap hostel: Hostel Casa Verde Santa Ana – 12.94/night

Transportation: 0.50

Meals: 10.80

Drinks/Entertainment: 6.00

Attractions: 2.00

Daily Backpacker Index: US$32.24/day

>>>Santa Ana prices and weather

Being one of the largest cities in South America, it's not too surprising that Santiago isn't quite as cheap as some of the others, but still it's a great bargain compared to almost anywhere in North America or Europe. This is often just a jumping-off point for other cities and sights in Chile, and most others tend to be even a bit cheaper. Visitors to Santiago will probably also want to spend some time in the nearby Colonial beach town of Valparaiso.

Currency: Chilean peso

Best cheap hostel: Aji Hostel – 6,819/night

Transportation: 1,320

Meals: 8,040

Drinks/Entertainment: 4,500

Attractions: 5,000

Daily Backpacker Index: CLP25,679 = US$33.18/day

>>>Santiago prices and weather

Obviously Mexico City is not even in Central America, but we include it here because it's popular on tours around Latin America. In spite what you might have heard in the past, the huge central city part of Mexico City is modern, safe, and clean. It looks like one of the richer cities in North America and the food is terrific as long as you enjoy those local flavors. Few people speak English, but it's loaded with highlights and a fantastic travel bargain.

Currency: Mexican peso

Best cheap hostel: Massiosare El Hostel – 250/night

Transportation: 10

Meals: 234

Drinks/Entertainment: 90

Attractions: 75

Daily Backpacker Index: MXN659 = US$35.05/day

>>>Mexico City prices and weather

Easily the most European city in South America, Buenos Aires is hard to compare to others in the region. When compared to Madrid or Barcelona this city is cheap and just as wonderful, but inflation continues to run at high levels so prices of food and drinks can be hard to predict in local currency. In recent years inflation has outrun the devaluation in the local currency, so it's become a bit more expensive for tourists, although still good value. You've probably heard about the amazing food scene and especially the local beef, and it's all true. As of 2020 the whole country is an amazing bargain, at least until inflation gets even worse.

Currency: Argentine peso

Best cheap hostel: Voyage Recoleta Hostel – 480/night

Transportation: 16.00

Meals: 816

Drinks/Entertainment: 360

Attractions: 500

Daily Backpacker Index: ARS2,172 = US$36.44/day

>>>Buenos Aires prices and weather

Argentina has several other key tourist cities to consider including the beach resort of Mar del Plata, the wine region of Mendoza, and the Alpine-style mountain resort of Bariloche.

This charming colonial town in Guatemala would be higher up the cheapness list if not for the fact that the main attractions, including trekking to nearby volcanoes and such, tend to be relatively expensive. Still, it's all worth it, and Antigua really is a great bargain destination, as well as being a far better alternative to nearby Guatemala City.

Currency: Guatemalan quetzal

Best cheap hostel: Matiox – 65/night

Transportation: 10

Meals: 115.20

Drinks/Entertainment: 60

Attractions: 40

Daily Backpacker Index: GTQ296.20 = US$38.47/day

>>>Antigua prices and weather

Just as Colombia is getting a lot of attention recently, Panama is the new “in” place to go in Central America. The large capital is perhaps the only real major international city in the region, so you've got your choice of nightlife and interesting dining and cultural experiences, all at a relatively low cost. Some nearby resort areas are also great bargains for those who just want to sit on the beach, so Panama should continue on the upswing for some time to come.

Currency: Panama Balboa/US dollar

Best cheap hostel: Hostal Casa Areka – 11.00/night

Transportation: 0.70

Meals: 14.40

Drinks/Entertainment: 6.00

Attractions: 8.00

Daily Backpacker Index = US$40.10/day

>>>Panama City prices and weather

This city feels like a slightly-worse and less special version of its neighbor (Buenos Aires), although the economy here has been more stable. Many museums are free to enter, making it even a bit cheaper than it would otherwise appear. Montevideo might be worth a couple of days for those touring the region, but it's not really a place to dwell unless you have a specific reason. Smaller towns in Uruguay, including Colonia, tend to be a bit cheaper, while the beach resorts such as the famous Punta del Este can be very expensive, at least by South American standards.

Currency:

Best cheap hostel: Compay Hostels – 374/night

Transportation: 66

Meals: 612

Drinks/Entertainment: 300

Attractions: 150

Daily Backpacker Index: UYU1,502 = US$40.19/day

>>>Montevideo prices and weather

The stunning city of Rio de Janeiro had actually gotten quite expensive for mid-market travelers, but in recent years the currency cooled off and it's something of a bargain again. Fortunately, backpackers can still find cheap hostels, and sitting on one of the gorgeous beaches is still free (and the cold beers on the beach are still fairly cheap), but the main attractions are anything but. Those wanting to take the cable car up Sugarloaf or the train up to Corcovado (and you have to do both) might need an extra trip to the ATM beforehand. You'll find generally lower prices in the beach resort town of Recife, and a wide range in the enormous nearby city of Sao Paulo.

Currency: Brazilian real

Best cheap hostel: Kaza Rio – 35.50/night

Transportation: 7.60

Meals: 67.20

Drinks/Entertainment: 21.00

Attractions: 50.00

Daily Backpacker Index: BRL181.30 = US$44.22/day

>>>Rio de Janeiro prices and weather

Roatán Island is a relative newcomer to the tourism scene, but it's become popular quickly for its excellent diving and snorkeling along with sandy beaches and a Caribbean vibe. Cruise ships now stop here and that has also changed the complexion of the island, making it far more commercial. It's close to the islands of Belize, with better beaches but similar prices in general.

Currency: Honduras Lempira

Best cheap hostel: Buena Onda Hostel – 295/night per person

Transportation: 66

Meals: 504

Drinks/Entertainment: 150

Attractions: 150

Daily Backpacker Index: HNL1,165 = US$47.42/day

>>>Roatán Island prices and weather

First off, “backpackers” are probably better off on the nearby island of Caye Caulker, since Ambergris Caye (where San Pedro is the main town) only has a few hostels. Most everything else between Caye Caulker and San Pedro are the same though, so this shows that Belize is one of the more expensive places in the region, even if it's still quite reasonable. As long as you don't need expansive sandy beaches (because Belize has few of those) this is a good bargain in the Caribbean for independent travelers.

Currency: Belizian dollar

Best cheap hostel: Sandbar Beachfront Hostel – 31.66/night

Transportation: 6.00

Meals: 43.20

Drinks/Entertainment: 18.00

Attractions: 10.00

Daily Backpacker Index: BZD108.86 = US$54.43/day

>>>San Pedro prices and weather

With an unfortunate reputation for being dangerous, Caracas is also among the most expensive cities on this list, though it doesn't have to be depending on where you exchange your currency. As of early 2020 Venezuela has become so unpredictable and so unstable that we have almost no confidence in the numbers below. The country has some wonderful scenery, but very few foreign tourists are interested in coming to the dangerous capital, so these prices probably don't even matter.

Currency: Venezuelan bolivares fuertes

Best cheap hostel: Dal Bo Hostel – 250/night per person

Transportation: 8

Meals: 192

Drinks/Entertainment: 60

Attractions: 45

Daily Backpacker Index: VEF555.00 = US$55.56/day

>>>Caracas prices and weather