Let’s be real, there are two things you’ll almost always hear in a conversation about Iceland:
- It’s many people’s top bucket list destination
- It’s too expensive to visit.
But, is it really as inaccessible as most think?
I’ve been to Iceland twice, and while I have definitely spent money, it’s not always as much as you may think!
Here are some of my budget hacks for Iceland.
Is Iceland really that expensive?
First and foremost, let’s tackle the big questions head-on – is Iceland cheap to visit? The short answer is no.
The country consistently ranks as one of the world’s most expensive countries for tourists. It’s a remote island nation where almost all goods, from food to fuel, are imported, which always leads to higher consumer prices.
However, the local standard of living is higher than a lot of the world, with a strong local currency (Icelandic Króna) and one of the highest wages in Europe.
But, is Iceland inaccessible? Also no!
Although Iceland is a more expensive place to visit, the country is highly comparable to Norway, Switzerland, Denmark, Singapore and even the more expensive parts of the UK when it comes to budgets.
Trip to Iceland cost: breakdown and tips
Flight prices
The costs of your flight to Iceland will highly depend on where you’re flying from and when.
London, for example, is home to some of the busiest airports in the world – so you might find return tickets to Reykjavik Keflavík for as little as under £100 from Stansted or Gatwick.
For cheap flights, EasyJet, WizzAir or PLAY (Icelandic company). And the cheapest time to fly is during shoulder seasons (May, September, October).
Accommodation
Accommodation costs in Iceland vary widely depending on the type of experience you’re looking for.
If you’re happy to stay in a hostel, you can find one for roughly 40 euros a night.
Similarly, guesthouses can offer some budget-friendly options (often with shared bathrooms) at around 80 euros.
However, if you’re after a hotel with more privacy, a basic room will typically set you back 100-120 euros a night.
During the peak tourist seasons, a hotel in a central location can exceed these prices, while higher-end options can easily go above 300 euros per night.
Always book well in advance and outside of the busy periods.
Transport
Public transport can be very affordable in Iceland and the capital is a highly walkable city.
But, to experience Iceland in its full glory, a vehicle is essential.
Car hire hosts will depend on the type of car you want to rent, ranging from 30 to 100 euros per day and even more for a 4×4 vehicle.
In the summer, consider renting a campervan with Campervan Reykjavik. While the daily rate is higher, coming at 150-300 euros a day, it brilliantly combines your transport and accommodation costs in one, saving you a considerable amount of money!
The insurance is also typically included for free.
The main consideration here is fuel costs, which are among the highest in Europe.
Eating out
Dining out can certainly be a shock to your wallet, as a casual meal like burger and fries in a restaurant can cost 25-35 euros. However, you don’t have to eat out every day!
If you have a tight Iceland travel budget, you can absolutely find cheaper options.
I did quite a lot of food shopping in grocery stores (Nettó, Bónus and Krónan are the cheapest).
Again, if you rent a campervan with kitchen equipment, you can cook a lot of your meals in it.
Don’t forget to bring a reusable water bottle, as tap water is available and free everywhere (it’s also famous for being incredibly pure!).
Activities and tours
Paid experiences, like whale watching ferry trips or guided Northern Light tours, are perhaps the biggest expense on a trip to Iceland – and they will put a huge dent in your travel budget.
Tours can range anywhere from 50 to 200+ euros per person.
On a budget, you may have to be picky about which activities are a must-have and which can be skipped.
The great news, on the other hand, is that most of Iceland’s most iconic attractions are completely free!
For instance, Skógafoss and Seljalandsfoss waterfalls, the Jökulsárlón glacier lagoon, Reynisfjara black sand beach, etc. do not have entrance fees.
If you’re driving, you can see these without paying for a guided tour.
Having a rental vehicle is also a great advantage to see the Northern Lights as well – you don’t need to fork out for a tour, just head to where the forecast is strongest!
There are apps that notify you on the aurora activity and best locations to view, so you can make Northern Light chasing a fun part of your trip, without splurging on a group tour.
So, is a cheap trip to Iceland possible?
Iceland is an expensive destination, but it’s certainly not an impossible one.
The ultimate cost of trip to Iceland is in your hands. If you are willing to compromise on certain things, you can absolutely make this dream trip possible on a budget!