Part of Recommended Outdoor Gear by Mark VerberEvery year I help organize several backpacking trips for the communities I participate in. Typically we will have several first time backpackers. I often get the question "What should I buy?" Everyone expects the first thing I will suggest is a good pair of boots. The next thing they expect me to suggest is getting a new backpack. My advise is to defer as many purchases as possible until they know this is an activity they really like, and they know what sort of backpacking they want to do. What follows are my recommendations about how to minimize the money you spend on backpacking equipment.
Check out and read some good backpacking books at the library, check out gear information on the web. I have tried to call out notable low cost alternatives in my Recommended Outdoor Gear pages as well as providing links to other good sources of information. There is a nice chapter entitled "Ultralight, Ultracheap" at the end of the document Lightweight Backpacking 101. There have been a number of online forum threads which discuss a gear list which is light and cheap: BPL ultralight / ultracheap challenge and $200 /20lb Philmont Challenge would be useful. 2003 I helped a friend get into ultra-light backpacking for around $400. I have a slightly modified the resulting list to produce a slightly more generic Low Cost Ultralight Backpack Gear List.
When possible use items that you already own rather than purchasing something new for backpacking. For example, you might have sports oriented clothing like soccer or bike jerseys which make good hot weather hiking shirts, running shoes with good soles can often be used rather than purchasing expensive hiking boots, etc. Ziplock makes some nice "disposal" bowls which work great on the trail. Be creative.
You really should delay the purchase of items until you know you really want to commit yourself to backpacking. What should you do in the mean time? Check to see if you have friends who would be willing to lend you gear. Try to rent gear from local outdoor outfitter. For example, stores like REI, sports basement, online rental companies like outdoorsgeek.com, or adventure travel companies like Outback Adventures rent a wide variety of equipment. If you are in school, see if you have an outdoor club which loans out gear. For example, Stanford's Outdoor Gear rents many items a prices below any of the commercial outfits which rent gear. Even after you decide that like backpacking, you should think about the frequency that you take trips -vs- the cost of renting gear.
When you do buy gear, make sure that you buy the right products for your needs. Otherwise, you end up having to buy the same type of item multiple times before you get the right one. So, make sure whatever you purchase is a quality product because no only will this be cheaper long term, but it will save you from the unhappy experience of having your tent, backpack, stove, etc fall apart miles from the trailhead. [I can tell you from experience that this is no fun!] Quality doesn't necessarily mean "name brand" or expensive, but you tend to get what you pay for, especially when it comes to sleeping bags.
I would also recommend buying only what you need. When you start looking at bargain sites it's easy to get excited about some item that is deeply discounted. If you don't need that item though, even highly discounted is taking away money that would be better spent on your most critical items.
When it comes to buying things I would start with a good pair of foot wear (hiking boots, hiking shoes, hiking sandals, or trail runners). I would recommend a sleeping bag be your second purchase for three reasons (1) it will be useful whether or not you commit yourself to backpacking, (2) a good light weight sleeping bag is one of the best long term purchases you can make (3) a good night sleep can make a huge different in how you enjoy backpacking. The third item I would consider purchasing is a backpack if you have a good idea what backpacking style (ultra-light, light-weight, etc).
You can save significant money by making your own gear. In particular I would suggest using an alcohol stove unless you are doing snow camping. I would also think seriously about making a sleeping quilt (down or polarguard) rather than purchasing a sleeping bag.
There are a number of "Used" or "Swap" areas on the various backpacking community sites. While it's sometimes hard to find light weight backpacking equipment, you can sometimes get lucky on craigslist, thrift stories and on ebay.
When shopping for gear, start by looking at Sierra Trading Post, steep and cheap, campsaver.com. Most of the big retailers like Campmor and REI have a "on sale" section.. The key with any of these bargain sites is to be patient and not to buy things just because they are "cheap". Only buy what you need. For people in in he SF bay area I would recommend checking out The North Face Factory Outlet in Berkeley, and the Patagonia Outlet in Santa Cruz, especially just before labor day and memorial day when their already discounted prices drop another 40%.