Budget: Less than 1 $
Materials needed: some cardboard - I used an old pizza box. Some pipe foam and duct tapes which one would expect are already available.
First things first.
I picked the length of the knife and cut out a suitable piece of cardboard. A soft core knife shouldn't be too long - its no use as an offhand weapon, you need it for throwing or slicing throats, backstabbing, as a boot knife and so on.
After that the cardboard is layered several times - this will be the core of our larp knife.
Once the core is done, the foam is cut into strips again. You don't have to be as careful as with the swords - when your core is cardboard hurting someone becomes quite the challenge. In fact, if you manage it, I'd say you should seek an army or law enforcement career. You may have noticed that I've aligned the foam sideways - its again for the same reason.
After that its time to shape your blade with the scissors or a paper knife.
When done, wrap the blade in duct tape, or in my case in aluminium foil.
Once the blade is wrapped, its time to do the handle. The string I've placed would be both decoration and give better grip on the handle.
Finally you wrap the handle of your larp knife in tape and its almost done.
There is one last step to do - flatten the blade. Put it under something heavy and leave it like this. It will take a while but in the end it won't look like a dicksword. Can't show you the final result since its still flattening - the other knife in this pic is halfway done.