The golden beaches of the Algarve have plenty of admirers from across the globe. This is especially true if you visit in the height of summer when it can seem like the entire world is encroaching on your beach blanket in Albufeira. Despite the Algarve’s popularity, there are still many great deals to be had in this sun-kissed corner of Portugal. 

Budget-friendly hotels are sprinkled through towns across the region, and if you don’t mind a bit of old-fashioned decor, you can score some amazing rates (under €75 a night for a double even in August) – though you’ll have to book well ahead. You can also find ways to eat well, get around sustainably and even go on island-exploring adventures, all without breaking the bank. Below is a rundown of the top ten ways to save money in the Algarve. 

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Two young women walking together in sunshine.
Two young women exploring Portuguese countryside of Algarve, Portugal. © Getty Images

Plan your visit outside of peak season 

Room rates skyrocket during July and August when visitors from across Europe and beyond descend on those lovely beaches. You can save upwards of 25% or more if you visit during the shoulder season – June and September. You’ll still have lovely warm days, though trips into the ocean will be a slightly chillier endeavor. May and October are also lovely times to visit and draw even fewer crowds. For rock bottom rates (typically half the rate of high season), come between December and February. Daytime highs hover around 16C (61 Fahrenheit) – ideal temperatures for hiking and other outdoor activities, and you won’t have to contend with any crowds. 

Figure out the cheapest way to reach the Algarve

Flying into Faro puts you in the heart of the Algarve, though don’t rule out traveling via Lisbon. Sometimes you can save substantially flying into the Portuguese capital, and it’s less than a three-hour drive (and a slightly longer train journey) to reach the Algarve from Lisbon’s airport. Another airport to keep in mind is Sevilla. Though the city lies across the border in Spain’s Andalucía region, the trip into the Algarve can be even shorter depending on where you’re going. Driving from Sevilla airport to Tavira, in the eastern Algarve for instance, takes only two hours. 

Consider staying in a hostel 

Apart from airfare, lodging costs are typically where you’ll spend the most money on a trip, but you can flip the script by staying in a budget-friendly hostel. If you’re picturing soulless, institutional-style dormitories, then think again. The Algarve has dozens of stylish places to bunk for the night, the best of which have outdoor pools, spacious terraces and lounges where you can chat with fellow travelers over drinks. Many hostels also have shared kitchens, which allow you to further economize by making some of your own meals. You’ll find a dense concentration of hostels in Lagos, including recommended places like Old Town.

Save even more money by pitching a tent in a campground 

With its pleasant weather throughout most of the year and easy access to beaches and nature parks, the Algarve is an ideal place for camping. As elsewhere in Portugal, you’ll find a good mix of well-equipped campgrounds, including some with restaurants, swimming pools and tennis courts, along with wifi access. Excellent options sprout across the length of the Algarve, with standouts like Orbitur Sagres on the dramatic Costa Vicentina (the west side) and Camping Albufeira, which ranks among Portugal’s best campgrounds. Though it’s not on the beach, Salema Eco Camp earns high marks for its forested setting and its commitment to sustainability, not to mention the many activities on offer. 

Travelers in a train station in Portugal
Lower your carbon footprint and save money by taking the train in Portugal © Benny Marty / Shutterstock

Ditch the car and get around by train

In Portugal, the high cost of rental cars coupled with ever-rising fuel prices doesn’t make for a particularly economical trip. You can save money and lower your carbon footprint by getting around on the train. Portugal’s rail network has good service coming down from Lisbon. You can also travel by rail from Lagos to Vila Real de Santo António (on the Spanish border) with stops at Portimão, Faro and Tavira along the way. 

Take a ride on the new Vamus Algarve bus network, traveling nearly anywhere you want to go 

The Algarve has drastically improved bus service in recent years. Launched in late 2021, Vamus Algarve operates numerous routes across the region, including an Aerobus (No 56) from Faro airport to key towns like Lagos and Albufeira. You can also take in some stunning coastal scenery by bus. The 52 EVA Cliffs Line stops at Carvoeiro, Praia da Marinha, Benagil and many other iconic beaches between Alvor and Pêra. For shorter distances, you can utilize ride-sharing apps like Uber and Bolt.    

Loule's bustling market in the Algarve. © amnat30/Shutterstock

Gather picnic ingredients from the Algarve’s many markets

You can cut expenses by sourcing at least a few meals from local markets. Much more utilitarian than the fancy (and pricey) farmers’ markets you’ll find in the US and the UK, Portugal’s mercados are go-to destinations for inexpensive but high-quality local produce, including fresh breads, cheeses, olives, smoked meats, fruits, vegetables, wine and all the other essentials. If you’re staying at a place with a kitchen, you can also find fresh-off-the-boat seafood for reasonable prices.

Skip the organized tours and head out on DIY activities

Sunset cruises and guided mountain biking trips are fun but can take a big bite out of your budget. Instead, do some advanced planning (ahem, Lonely Planet books are a good place to start) and plan your activities around things you can do on your own. Many places hire bikes for a rewarding day of cycling along the coast, and you can hire paddle boards and kayaks at many beaches (like Meia Praia) for inexpensive seaside adventures.   

Portugal Restaurant and Tourists Rua 25 de Abril Lagos Algarve Portugal EU Europe
Restaurants on Rua 25 de Abril in Lagos, Algarve. © Alamy

Seek out a tasca for a deliciously affordable meal

Tascas are small, often family-run restaurants where you can eat well at low prices. You’ll find them tucked away from the more touristy areas, and the crowd tends to be mostly local. The focus of the menu here is not on variety but on fresh, simply prepared dishes – typically featuring bacalhau (salted cod), lulas fritas (fried squid), filete de pescado (fish filet), bife de vaca (steak), and other well-executed crowd pleasers. Many tascas also have a prato feito (‘fixed plate’ or daily special), which usually comes fresh from the market. Lunch is the time to go – in fact, many tascas aren’t open for dinner, so plan to have your big meal at midday. 

Spend the day relaxing on the Algarve’s islands 

For a memorable outing, plan the day around a visit to one of the Algarve’s narrow barrier islands. You can spend the afternoon basking on the beach and enjoying the coastal tranquility (a near certainty given the absence of cars), and the journey to get here is part of the fun. From the town of Tavira, you can catch an inexpensive ferry for the short ride out to Ilha de Tavira, an enticing 11km-long seaside escape of dunes, woods and sparkling sandy beaches. You can also get there via a whimsical narrow-gauge train from the town of Pedras d’El Rei. Faro has its own share of islands, including the Ilha Barreta (aka Ilha Deserta or ‘Deserted Island’) that offer a remote (but easy-to-reach) island experience that’ll cost only a few euros to reach on the ferry. 

Daily costs in the Algarve

Hostel room: from €22-40 ($23.30-42.50) for a dormitory

Basic room for two: €40-80 ($42.50-85)

Self-catering apartment (including Airbnb): from €100 ($106)

Train ticket Lagos-Tavira (110km/68mi): €9.50 one-way ($10)

Um cafe (espresso): €0.80-1.30 ($0.85-1.37)

Bifana (pork cutlet sandwich): €3-5 ($3.18-5.30)

Dinner for two: €40-70 ($42.50-74.20)

Cerveja (beer) at the bar: €2-4.50 ($2.10-4.80)


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