Munich has prices that are typical of Germany, which puts it on a similar level to Amsterdam and definitely cheaper than London or Paris. The exception is if you are planning to come for Oktoberfest when hotels and hostels jack their prices way up. Otherwise you can usually find some good deals when searching for accommodation, especially in the neighborhood near the central train station.
This is a very outdoor city so many of the more interesting sights are free or quite cheap, which helps those on a low budget keep from going broke. Even the Oktoberfest itself is affordable if you don’t plan on riding the rides, as food and drink prices tend to be more or less in line with most restaurants, and everything else is free.
Thanks to an excellent system of the S-bahn and U-bahn trains, transportation in Munich is quite cheap, especially if you opt for the all-day pass. On the other hand, it’s difficult to find food and drinks on the cheaper end of things, unless you don’t mind the wurst (sausage) carts you see on many sidewalks.