Panama is not always expensive. Traveling here is slightly cheaper than traveling in Europe, Canada or the United States, but slightly more expensive than Guatemala, Honduras or El Salvador.
It’s not the most expensive country in Central America — that award goes to Costa Rica, followed closely by Belize — but frugal travelers need to plan carefully and sacrifice a few home comforts to keep costs down.
Luckily, there are plenty of ways to save on food, lodging, transportation, and excursions. Beaches are free and there’s no shortage of outdoor activities in Panama’s expansive and affordable national park system.
Here are our top tips for your Panama adventure Bueno, Bonito and Barato (good, nice and cheap).
Visit during the rainy season
The rainy season in Panama lasts from May to November. Hotel rates can drop by 10-30% during this period, but you have to contend with torrential rains. Most downpours are fairly brief, breaking out in the afternoon and disappearing an hour or two later, but several days of continuous downpours are not unheard of. Certain activities like bird watching and white water rafting are much better during the rainy season.
Bocas del Toro has a very changeable microclimate; The province is frequently wet when the rest of the country is dry, and sometimes vice versa. International flights to Panama tend to be cheapest towards the end of the rainy season, from September to November.
If you only want to visit western Panama, consider flying to Costa Rica
Many of Panama’s best attractions are in the western provinces of Chiriquí and Bocas del Toro. Unless you intend to travel beyond these areas, it is sometimes (but not always) cheaper to fly to San Jose, Costa Rica and then travel overland to Panama.
The direct bus from San Jose to the international border at Paso Canoas takes about an hour longer than the bus from Panama City to David (the second largest city in Panama). You have to go through immigration formalities, which can be time-consuming.
Getting to Chiriquí is faster and cheaper if you use intercity buses instead of international buses like Ticabus, which usually means longer journeys and higher prices, and doesn’t stop at David.
Take the bus to and from Tocumen Airport
An official taxi from Tocumen International Airport to downtown Panama City will cost you USD 30-40. A shared taxi is cheaper at around $15 per person if you’re traveling alone.
The cheapest is the Metrobus, which costs no more than $1.25. Before leaving the airport, be sure to buy a rechargeable Metrocard, which is valid for all metro buses and trains. They cost $5 and are easy to drive with $3 in fares.
Note that you need a Metrocard to use long-distance services at Albrook Bus Station.
If you are single, stay in a hostel dorm
Solo travelers will find the cheapest digs in hostel dorms. Depending on your location, you can get some amenities and clean accommodations for $10-$20 per night.
Hostels are common in the major tourist hubs of Panama City, Boquete, and Bocas del Toro, but less common elsewhere.
Couples and groups should stay in hotels
A private room in a cheap hotel costs about the same as a private room in a hostel, around $30-$50 per night. In terms of comfort, however, hotel rooms are usually superior. The cheaper, more spartan rooms have fans and only cold-water showers (air-conditioning can add $15-$20 to the rates).
Some hotels have a handful of extremely basic, ultra-cheap units ($15-20) with shared bathrooms; Ask at reception if they have Algo más económico (slightly cheaper) or un quarto con baño compartido (a room with shared bathroom).
Of course, the biggest downside to using hotels is that you don’t have a communal kitchen at your disposal.
If you really want to save, sleep in a hammock
If you don’t mind roughing it up, a hammock is the cheapest option. Hostels typically charge $2-5 per night for a pitch, and you may find locals willing to offer the same service.
Use mosquito repellent, nets and/or insecticide coils, especially in the rainy season. A warm blanket or sleeping bag may be necessary as temperatures can drop significantly at night, even in the steamy lowlands. Note that it is unsafe to stay in public places, including the beach.
Take advantage of public transportation in Panama City
Taxi drivers in Panama City are notoriously smart. Excessive fees are the norm, especially if you appear to be a foreigner. Worse, the city is frequently congested, making car travel slow and inefficient.
To save money and hassle, use metro buses and trains to get around ($0.25-$0.35 per trip). If you must use taxis, try to agree on a price before getting in. And if your driver turns out to be a good driver (many of them are), grab their cell phone number for future reference.
Avoid tourist taxis and taxis waiting in front of hotels. They will surely overwhelm you. Ubers are usually cheaper and easier than taxis.
Opt for buses over domestic flights
Domestic flights are undeniably fast. You can cross the entire country from Panama City to David by plane in about an hour. But with most round-trip fares over $120, domestic flights don’t come cheap, and they also have a significant carbon footprint.
Although significantly slower (the same journey from Panama City to David takes seven to nine hours), the Terminales David-Panamá (TDP) or Padafront buses are far more economical and environmentally friendly.
Treat yourself to fruit for breakfast
Fresh fruit in Panama is nutritious, tasty, ubiquitous and cheap. Options include a colorful array of locally grown produce such as pineapples, papayas, avocados, bananas, watermelons, and oranges.
Get fruit from street vendors and local markets (a fruit breakfast in a restaurant is relatively cheap). Smoothies are another healthy and economical option.
Indulge in carbs for lunch
If you eat out a lot, lunch is the cheapest meal of the day. Street food is few and far between in Panama, but there are plenty of affordable sit-down restaurants, typically offering inexpensive set menus and/or high-carb buffet lunches for around $5 per person.
A typical Panamanian lunch consists of a greasy meat or chicken entree with a generous side of rice and beans, along with some (sometimes sweetened) plantain slivers and a sugary drink. Unfortunately, vegans and vegetarians are not well served in Panama.
You can generally drink the tap water
With the exception of Bocas del Toro, Guna Yala and other remote areas, tap water in Panama is generally safe. Save money and plastic waste by refilling your reusable water bottle at a kitchen faucet.
Choose tours and excursions carefully
If times are not very tight, you should treat yourself to one or more tours. If you speak reasonably good Spanish, sourcing your own local guides can be cheaper than hiring a tour operator.
It’s best to get solid recommendations from your hotel or hostel, who usually know where the best deals are. Most cities have a national environment ministry office, Mi Ambiente, to point you in the right direction.
A Guide to Daily Costs in Panama (US Dollars)
Shared rooms in a hostel: $10-20
Simple hotel room for two: $30-50
Self-Catering Apartment (including Airbnb): $70-100+
Public transportation in Panama City: $0.25-0.35 or $1.25 for toll roads
Lunch for two: $10-20
Dinner for two: $20-40
Beer at the bar: $1-3