Panama City on a Budget: How I Did It on €20 a Day

Panama City was the first stop of my three-week Central America backpacking trip, and for most of that trip our budget was around €20 a day. Some days we spent a little more, some days less, but that was basically the number we were trying to stick to while moving through the region.

Panama City can get expensive really fast if you start staying in nicer hotels, eating every meal in tourist areas and booking tours every day. We did the complete opposite. We stayed in a cheap hostel, had breakfast included, cooked simple dinners, ate one proper meal out, used public transport and walked way more than I would ever recommend doing with two backpacks.

So yes, Panama City on a budget is possible, and in my case I managed it on €20 a day. But this is a proper backpacker budget, not the kind of travel-blog “budget” where someone spends €100 on a hotel and calls it affordable.

My Panama City Budget: €20 a Day

The biggest reason this worked was accommodation. We paid around €10 each for a dorm bed at Casa Areka, and breakfast was included, so half of the daily budget was already gone but at least the first meal of the day was covered too.

For lunch, we usually ate somewhere cheap outside. One of the best examples was Fonda San Felipe, where I paid around $6 for food and a Coke. Dinner was usually something very basic from the supermarket cooked at the hostel, because Casa Areka had a kitchen and there was a supermarket right behind it.

Transport barely affected the budget because public transport in Panama City is incredibly cheap, and we also walked a ridiculous amount. Sightseeing itself was mostly free because we spent our day exploring Casco Viejo and walking around rather than paying for attraction after attraction.

That is basically how the €20 worked. Cheap dorm, breakfast included, one cheap meal out, simple dinner, cheap transport and free sightseeing.

How to Get From Panama City Airport to the City on a Budget

How we did it

We took the metro/train from Tocumen Airport toward the city. I don’t remember exactly how much we paid at the time, but the current metro fare from the airport into the city can be as little as $0.85 if you use Line 2 and then transfer to Line 1.

The stupid part came after that.

My friend decided that instead of paying for an Uber from wherever we got off, we were going to walk to Casa Areka and save money. Apparently he had looked at the map and decided the distance was completely reasonable. He also seemed to forget that I walk slowly, Panama City is hot, and I was carrying two backpacks.

We walked for over an hour.

By the time we finally reached the hostel, I was sweating like a donkey and getting more and more pissed off because I’m pretty sure an Uber would have cost us something like €5 anyway. So basically, we suffered through an absurd walk with all our luggage to save maybe €2 or €3 each.

That is exactly the kind of budget decision I would not repeat.

The cheapest option now

If you want to keep costs low, the metro is still the obvious cheap option. Line 2 costs around $0.50 and Line 1 around $0.35, so getting from the airport toward the city by metro can cost less than $1 depending on where you need to go.

After that, check how far your accommodation actually is before deciding you’re suddenly an athlete. If the last part of the journey is awkward, just pay for a short Uber.

Budget travel is supposed to help you travel longer. It is not supposed to make you miserable for the sake of saving €2.

Where to Stay in Panama City on a Budget

We stayed at Casa Areka, and for our kind of trip it worked really well. We paid around €10 each for a dorm bed, breakfast was included, there was a kitchen, and the supermarket behind the hostel made it easy to keep food costs down too.

That combination matters more than people think. A hostel that costs €2 less but has no breakfast and no kitchen might actually cost you more by the end of the day because suddenly you’re paying for three meals outside.

Our routine was basically breakfast at the hostel, lunch somewhere cheap in the city, and dinner back at the hostel with whatever simple food we bought at the supermarket. Eggs, sausages, something quick. Nothing exciting, but it worked.

→ Read my Casa Areka Hostel review

→ Read my guide to the best hostels in Panama City

How to Eat in Panama City on a Budget

Food is where Panama City can start feeling expensive pretty quickly, especially if you eat every meal around the more touristy parts of Casco Viejo.

We tried not to do that.

One of the cheapest and best meals I had was at Fonda San Felipe, which we found completely by accident. We saw a line of locals waiting outside, had no idea what the place was, and decided that if that many local people were eating there, it was probably worth trying.

There were different dishes already prepared, you chose what you wanted, and I paid around $6 for my meal and a Coke. For Panama City, especially after seeing the prices in some of the more touristy areas, that felt like a much better deal.

Dinner was where we saved the most because we normally cooked at the hostel. If you’re trying to stick anywhere near €20 a day, eating out three times a day is going to destroy the budget very quickly.

Having breakfast included and a kitchen at the hostel made a huge difference.

How to Get Around Panama City Cheaply

Public transport in Panama City is incredibly cheap. Regular local buses can cost around $0.25, some corridor services around $0.75, and metro rides are generally around $0.35 to $0.50 depending on the line.

We also walked a lot around the city, especially once we were around Casco Viejo. I don’t remember every route we took anymore, but we spent a lot of that day simply walking around and exploring.

At one point we also went to the bus station to buy our tickets for Bocas del Toro. On the way back, we took a local bus that got stuck in traffic and basically stopped moving.

My friend wanted to get off and walk again.

After the airport disaster, absolutely not.

I was perfectly happy sitting on that bus doing nothing. At that point, sitting in traffic sounded much better than another marathon across Panama City just because walking was free.

Free Things to Do in Panama City

One of the good things about Panama City is that you can fill most of a day without paying for attractions. Casco Viejo was where we spent most of our time, and you can easily wander around the old streets, plazas and colonial buildings for a few hours without spending anything.

While you’re there, you can also walk through Plaza de Francia and Paseo Esteban Huertas, then continue toward the waterfront. The Cinta Costera is another completely free option if you want views of the bay and Panama City skyline.

If you want a little more structure without paying for a normal sightseeing tour, there are also free walking tours in Panama City. They usually work on a tip-based system, so the tour itself is free to join and you decide how much you want to tip the guide afterward. We mostly wandered around by ourselves, but for someone traveling on a tight budget who still wants some context about the city, this is a really good option.

→ Find a free walking tour in Panama City here

Can You Really Do Panama City for €20 a Day?

Yes, but you need to actually travel like a backpacker.

A rough daily breakdown can look like this:

Dorm bed: €10
Breakfast: included
Lunch: around €5–€6
Dinner: around €2–€3 from the supermarket
Public transport: around €1 or less
Sightseeing: free

That puts you roughly around €18–€20 a day.

Some days will obviously cost more. Maybe you want an Uber, maybe you eat somewhere nicer, maybe the hostel price changes. But if you keep accommodation cheap, use public transport, cook some of your food and focus on free sightseeing, €20 is not an impossible budget.

A More Comfortable Panama City Budget

If €20 a day sounds a little too broke-backpacker for you, then €30–€40 a day gives you considerably more freedom without suddenly turning the trip expensive. You can eat out more often, take an Uber when walking really isn’t worth it and stop calculating whether spending another €3 is going to destroy your budget.

I’d still keep the bigger tours separate, though. Even at €40 a day, some of the main experiences around Panama City cost more than your entire normal daily budget, so I think it makes much more sense to consider them an occasional splurge rather than part of the everyday cost of traveling here.

How Much Do Panama City Tours Cost?

The €20-a-day budget covers accommodation, food, cheap public transport and mostly free sightseeing. If you want to add some of the bigger experiences around Panama City, I’d treat those as separate splurges rather than pretending they fit inside the normal daily budget.

A Monkey and Sloth Jungle Habitat tour costs from around €25, which I actually think is pretty reasonable if you want to add one paid experience. On a €20 backpacker day, that would bring your total to roughly €45.

→ Book here: Panama: Monkey and Sloth Jungle Habitat Panama Tour

The Panama Canal: The Most Complete Wildlife Experience costs around €40. That brings the day to roughly €60, but this is exactly the kind of thing I’d rather save money for instead of spending the same amount across nicer restaurants, taxis and other things I probably won’t remember.

→ Book here: Panama Canal – The Most Complete Wildlife Experience

An Embera Village and Waterfall Tour with lunch also costs around €40, so again, I’d treat it as an extra experience rather than part of the everyday budget.

→ Book here: Embera Village and Waterfall Tour

The expensive one is San Blas, at around €125 for a day trip. That is more than six days of my normal Central America budget, so for me this would be a proper splurge and something I’d need to really want rather than randomly adding because I had an extra day.

→ Book here: San Blas Day Trip

Is Panama City Expensive for Backpackers?

Compared with some other places in Central America, Panama City can definitely feel expensive.

The good thing is that the expensive parts are easy to avoid if you want to. Hostels can still be cheap, public transport costs almost nothing, local food can be affordable and a lot of the city can be explored for free.

The costs really start climbing when you move into private rooms, nicer restaurants, taxis everywhere and paid tours.

So Panama City is not necessarily expensive by default. It depends a lot on how you travel.

Panama City on a Budget: My Verdict

You can absolutely visit Panama City on a budget, and I managed it on €20 a day during my Central America trip. We stayed in a cheap hostel with breakfast included, ate one inexpensive meal out, cooked dinner at the hostel, walked a lot and used public transport whenever we needed it.

That budget obviously does not include expensive tours or a private room, but if you are genuinely backpacking and trying to keep costs low, Panama City can still be manageable. The important thing is knowing where saving money actually makes sense and where it becomes stupid, like walking for over an hour with two backpacks just to save a couple of euros on an Uber.

That is basically how I travel anyway. I would rather keep the boring daily costs as low as possible and then spend extra money on the experiences I actually care about instead of wasting it on things that make no difference to the trip.