Iceland is an amazing country with amazing natural wonders, great culture and vibrant nightlife. But it is also one of the most expensive countries to visit in the world. But don’t let that stop you from visiting this incredible place. Check out my tips here for traveling in Iceland on a Budget.

Iceland is an incredible country that should be on most people’s bucket lists.  There is so much to see and do, and the sights are truly unbelievable and unmissable.

Iceland is one of the safest countries in the world for women to travel solo to.

But Iceland is an expensive country to visit and has a very high cost of living. Because Iceland is an island pretty much everything there is imported, which means that costs are higher. Iceland also has a small population, and therefore a small possible workforce, leading to higher labor costs.

If you are planning to head to Iceland, and you are on a budget, come up with a reasonable budget before you go.  Find out what the currency rate is (Iceland uses the Krona), and rely on using credit cards if possible, as taking out cash will come with fees too.

Research and plan ahead and you should be able to keep to your planned travel budget and what you can afford.

Here are 10 tips to help you save money on a trip to Iceland!

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See the Free Sights in Iceland

Iceland has some great museums, especially in Reykjavik, but they do have fairly expensive entry fees. Tours around Iceland can also be fairly expensive, as can fees to enter places such as the blue Lagoon.

Iceland however has many things to see for free.  These include many places in Reykjavik such as the Sun Voyager, and Hallgrímskirkja church.  You can also stroll around the streets of Reykjavik and take in the sights there for nothing! Reykjavik also has many free walking tours too.

Many of the natural sights around Iceland can be visited for free – such as beaches, waterfalls, and geysers.  There are also many free hot springs, such as Reykjadalur and Seljavallalaug, if the Blue Lagoon is just too pricey for you.

How to Save on Alcohol Costs in Iceland

Iceland, especially in Reykjavik, has some amazing bars and restaurants. But alcohol prices are high with big taxes placed on beer, spirits and wine.  There is no doubt that alcohol and going out will be one of the highest expenses you will have in Iceland.

A way to save on alcohol is to buy Duty Free alcohol in the airport shops on arrival at Keflavik airport.  The last time I visited the main Duty Free airport shop it had a wide range of different products, including many of their own locally produced drinks.

While you can’t take that alcohol with you to bars and restaurants, you could ‘pre-game’ a little before a night out with your own drinks!

You can also try to hit all the happy hours in the bars in Reykjavik for much cheaper drinks. Most of the bars there have a happy hour.

How to Save on Food Costs in Iceland

Meals in restaurants can be fairly expensive in Iceland. Alcohol is also pricey as is is subject to high taxes.

It is possible to buy things such as sandwiches and wraps in grocery stores and gas stations, and there are some Subway sandwich stores in Iceland in the major towns.  There are also hot dog stands dotted around many towns, as Icelanders love hot dogs!

Some museums and attractions also have restaurants, and they can be lower priced than other restaurants.

The IKEA store restaurant near Reykjavik is popular with locals to eat because of its low cost food and meals.

If you are staying somewhere with its own cooking facilities you can also make some of your own meals to save on eating out costs.

The Kolaportið flea market in Reykjavik is also a great place to buy food.  They sell fish, bread, pastries and more.  We were able to also buy the popular flavored salts and chocolate here in the food hall part that were much cheaper than other stores we saw them in (and the exact same products).

 

How to Save on Clothing Costs in Iceland

Clothing, like everything else, is very expensive when purchased in Iceland.  When I last visited I decided the boots I had brought with me were just too clunky for all the walking around I was doing.  But finding another pair of boots that was ideal was not just difficult, whatever was available was just so expensive.

While emergencies can happen of course when you get there and you need to buy something, try to plan ahead for your trip and take everything you will possibly need with you.

There are a few second hand thrift shops in Reykjavik itself, where you can buy all kinds of clothing at very low prices.  I was able to get a great sweater in one of these shops, which would have cost a fortune anywhere else. The Kolaportið flea market also has second hand clothing, including Icelandic sweaters and more.

There is also an H&M store on Austurbakki 2 in downtown Reykjavik where you can get some clothing that isn’t too high priced.

See my tips on the essentials to pack for a trip to Iceland here

How to Save on Accommodation Costs in Iceland

Prices for accommodation depend on the time of year you visit, and where exactly in Iceland you will be staying. Prices in Reykjavik are higher than places outside of the capital in the countryside.

Summer time in Iceland has the highest accommodation rates (summer in Iceland is basically around May to August). Whereas the winter has some of the lowest rates.

There are numerous types of accommodations available in Iceland, including small hotels, guest houses, bed and breakfasts, hostels, air b&b and more.

If you do book accommodation do it as soon as possible once you have your flight tickets booked. It will be cheaper further out from when you are arriving to book, and most places allow you free cancellations close to the time you will be arriving (always check individual cancellation policies).

Here are some tips for saving money on accommodation in Iceland:

Consider camping.  Camping is very inexpensive.  You have to pay a site fee each night, and you may have to pay for things such as laundry facilities, but fees are not a lot. You will also need camping gear, such as a tent etc, but it may be possible to rent these locally.  Most camp sites do not take bookings in advance, so you will need to secure a site when you arrive.

Take a Refillable Water Bottle

The tap water in Iceland is clean and pure, and very safe to drink. Save money (and the environment) by refilling a water bottle as you travel around.  (see my guide here to the best Refillable water bottles for travel).

Rent a Car

Rent a car to get you around all the sites, and save on money for tours and transportation.  You can drive all around the Golden Circle, visit the waterfalls, geysers and so many places.  The nice thing about renting a car is that you can take a detour and make a stop somewhere anytime you wish to.

Driving is relatively safe in Iceland, but there are of course hazards that can arise, especially in relation to the weather. See this guide and watch the video on safe driving in Iceland.

Visit in the Low Season

If you visit Iceland in its winter season – November to March – you may get lower prices on things such as hotel rooms, flights and more.

But note, during the winter season the snow will be worse, and many roads will be impassable and sights difficult to see.

Many tourist attractions and trips may not be fully operational also due to it being off-season and not in such high demand.

But you can still explore Reykjavik by walking its streets, and visiting its restaurants and bars, museums and other cultural sights.

See also: What to see and do in Reykjavik

 

Visit Iceland on a Flight Layover

To save on flight costs to Iceland, consider exploring Iceland on a layover on your way to another destination.

If you book a flight with Iceland Air you get a free stopover in Iceland. The first time I went to Iceland I did this on a flight to England. I got a great price on my flight, and I stopped over and saw many of the sights that I wanted to see in Iceland on my way home.

Iceland isn’t a huge country, and if you only have a one day layover, you will be able to visit places such as Reykjavik and the Blue Lagoon easily.

Take Public Transport

Reykjavik is well covered with public transportation.  It is an inexpensive way to get around, instead of taking taxis.  Iceland’s public transportation network can be seen here.

City buses in Reykjavik are clean and incredibly punctual and on time.  However they do not run very frequently, and you have to purchase bus tickets at convenience stores.  You can also download an app and pay for your tickets online with credit card too.

Don’t let the fact that Iceland is one of the most expensive countries in the world put you off visiting this amazing place.  Pre-planning and research, coming up with a budget, and these budget travel trips will help make your visit one to remember!

Iceland is an amazing country with amazing natural wonders, great culture and vibrant nightlife. But it is also one of the most expensive countries to visit in the world. But don’t let that stop you from visiting this incredible place. Check out my tips here for traveling in Iceland on a Budget.