Is it safe to drink the tap water?

No. Use a filtered bottle or buy large 5-7 liter jugs at supermarkets to refill your smaller bottle.

How much cash should I carry?

Carry enough for 2-3 days of expenses. ATMs are plentiful in major cities, but cards are rarely accepted in small towns or markets.

Backpacking Peru on a Budget

Backpacking Peru on a budget is best achieved by sticking to overnight buses to save on accommodation, eating at local 'menú' restaurants, and booking treks independently or via local operators in Cusco rather than online in advance. Expect to spend between $35 and $50 per day to live comfortably while covering transport, food, and hostel dorms.

Use buses for intercity travel. Avoid domestic flights. Use reputable bus lines like Cruz del Sur or Oltursa. Book your tickets at the bus station 24 hours in advance to secure lower walk-in prices instead of paying international booking fees online.
Eat the 'Menú'. Look for small local restaurants offering a 'Menú del día' during lunch hours (1:00 PM – 3:00 PM). You will get soup, a main course, and a drink for 10–15 soles ($2.70–$4.00).
Book treks in Cusco. Do not book your Salkantay or Inca Trail trek from home. Wait until you arrive in Cusco and visit at least four local agencies to compare prices. You can often negotiate a 15–20% discount for next-day departures.
Utilize hostel kitchens. Shop at local 'Mercados Centrales' for fresh produce and grains. Prepare your own breakfast and dinner at least four nights a week to significantly lower your daily spend.

Is it safe to drink the tap water?: No. Use a filtered bottle or buy large 5-7 liter jugs at supermarkets to refill your smaller bottle.
How much cash should I carry?: Carry enough for 2-3 days of expenses. ATMs are plentiful in major cities, but cards are rarely accepted in small towns or markets.