There are three main handle woods which where used depending on your geography. In America hickory was used, in Canada where hickory was not available or ash, Sugar maple was used, and Europe Ash. These are the main woods but of course there were others as the people above will tell you.
The cheapest way to get handles is to pick wood which others have cut down. Here people usually leave it on the curb so others can take it as firewood. All you need to do is split it, season it and shape it when you need it. all you need to shape is a hatchet, rasp, file and if you want it to look pretty some sandpaper will help.