Iceland on a Budget: Can It be Done?
Photo by Andy Vegueria
Iceland is now my FAVORITE vacation destination ever (well…maybe tied for first with Spain). I dream about Iceland, gaze longingly at the photos we took there, and hope to go back — with friends — ASAP. They have a higher population of sheep than people (probably more waterfalls too) — doesn’t that sound glorious? It’s such a soul-refreshing place!
Unfortunately, Iceland is also one of the most expensive countries in the world to visit. The question is: can it be done on a budget?
I’d argue, yes. How much you spend on a trip to Iceland — or anywhere — depends on a lot of factors, but I hope this account of our recent trip (September 2021) provides some helpful estimates for your planning! Before I get to our spending summary (feel free to scroll to the end), here are some practical hacks for keeping costs low:
1) WATCH YOUR FOOD SPENDING
Food, like most things in Iceland, is very expensive.
To offset the cost of food, we packed nonperishable snacks such as beef sticks, trail mix, granola bars, pistachios, and pumpkin seeds in our checked bag (to be replaced by souvenirs on the way home). Plus, things like sandwich bags, alcohol wipes, & insulated “cooler” type bags to pack and eat lunches on the go. PRO-TIP: Just-add-water coffee packs came in clutch many a day, as coffee options were limited in the Middle-of-Nowhere, Iceland!
We also stopped at bakeries for bread and grocery stores for ingredients like eggs, onions, tomatoes, greens, cheese, & avocados to make “hearty” scrambled eggs breakfasts that would fuel us for the day, as well as staples such as seasonal skyr (Icelandic yogurt), peanut butter & jelly, milk & cereal, apples, mandarins, chips, and bars of chocolate. Many grocery stores close early (like 6 p.m.), so it’s important to plan your shopping times accordingly!
When you do eat out, eat out for lunch instead of dinner. Go for street food over full-service restaurants. And go for the Icelandic specialties: lamb, fish & chips, hot dogs, all sorts of seafood (especially langoustine & cod), soups, skyr, ice cream, and cakes. (Some places serve horse and fermented shark, but we had no desire to try those.) Tons of good “American style” food options exist as well, like burgers and pizza.
2) BOOK LODGING EARLY
You’re going to want to reserve lodging ASAP, as options are extremely limited (and expensive) around the island!!! Our 2 Airbnb cabins (3 nights each) were great “home bases” — located near Borgarnes at the beginning of the trip and Hella at the end. Most importantly, they each provided a full kitchen and washer for laundry.
Our one-night stays (while driving the North and East of the island) were at guesthouses and hostels reserved through Booking.com, which all had private bathrooms and breakfast included. These were hit or miss (the nicest, most hotel-like was Glacier World). Overall, our cost of lodging averaged $227/night (for 3 people) – so, not cheap! And these were pretty basic accommodations during the off-season.
3) CHOOSE YOUR SEASON WISELY
We went Sept. 6-15. September is an all-around more affordable time to go (post-summer, “shoulder season”), and offers the earliest chance of seeing Northern lights (we didn’t see them due to low aurora activity and cloud cover). It was not too cold (usually 40-50 degrees F), but was windy/rainy much of the time — especially in the south and east of the island.
Some downsides to September are: the puffins leave at the end of August, being rainy season means lots of cloud cover and a lower chance of seeing Northern lights (compared to winter), and there are stormy conditions some days. But, it sure beats summer prices and winter weather conditions! Would go back in September again, for sure!
P.S. for a September visit, I might start watching (Google) flights in January. The window for cheap international tickets is usually 4-8 months ahead, but we actually booked our tickets in July (2 months ahead of our trip), so good deals can sometimes be unpredictable! We flew with Delta ($462/person RT), but Iceland Air is another good option.
4) PACK WITH INTENTION
It wasn’t so much “cold” as it was windy/rainy. So, we didn’t need heavy winter coats or ski pants. Rather: layers are the name of the game! Comfy layers, with a quick-dry and/or waterproof outer layer (non-negotiable — you will get rained on)!
Note: I’m from Florida, so I had to purchase a lot of chilly-weather gear in preparation for this trip. But rather than spend a ton on expensive thermals from REI or something, I repurposed yoga pants and long-sleeve cotton shirts to be my base layers, and this worked out well.
Our first and last Airbnb stays had washing machines as well, so we were able to pack a minimal ~4 days’ worth of clothes + what we wore on the plane.
What I recommend packing for Iceland in September:
Base layers: 3 ankle-length yoga pants (or thermals) + 4 long-sleeve shirts + 4 long wool socks
3 quick-dry hiking pants (1 pair that’s totally waterproof) – we liked PrAna, Kuhl, and Columbia brands. Do yourself a favor and leave your jeans at home!
1 or 2 zip-up sweaters (wind-breaking, athletic, hooded)
1 heavy knit sweater (for non-hiking-days, just to change it up)
Raincoat (warm, waterproof)
Pajamas, undies, & extra socks for good measure
Lined beanie, waterproof gloves, neck warmer/scarf
Hiking boots (ideally with ankle support) & sneakers (for travel days, especially. But always good to have as backup in case your boots get wet)
Swimsuit, flip flops, quick-dry towel for the blue lagoon and hot springs
Waterproof backpack for hikes
Reusable water bottles (Icelandic water is a-mah-zing!!!)
Camera stuff
European plug converters and a battery pack for charging phones or other electronics on the go
In my backpack, I always carry basic first aid & medicines, tissues (for any kind of bathroom or sniffles emergencies), sunglasses, sunscreen, lotion, Chapstick, alcohol spray/wipes, snacks, reusable water bottles, and extra space for removal of layers.
Most important of all, don’t forget passports, credit/debit cards, and vaccination cards (check for COVID updates as to whether you’ll need to take tests or masks).
5) GET CREATIVE
Reserve a hybrid rental car to save on gas. Choose free, self-guided activities (hikes, hot springs) over expensive tours and excursions. Buy your souvenirs at the airport (much of the same stuff and like 30% cheaper). Buy any alcohol the same way (duty-free!). There are lots of ways to save when you make a plan and stick to it!
ONTO THE JUICY FINANCIAL DEETS!
FYI, we needed cash for 0 things in Iceland. We didn’t even look for an ATM.
(Like traveling anywhere, make sure to use a card with no foreign transaction fees and with a security pin on it — especially important for gas stations. Notify your banks/card companies before you travel abroad, so they don’t flag fraud. And always have at least one backup card from a different bank/card company in case your preferred one gets locked!)
The conversion rate when we were there was ~1 Icelandic krona (ISK) to .0078 USD. Meaning, for example, if your dinner comes to 6000 Isk, that’s ~$47. You could do the quick math of taking off the last two zeros and subtracting by 10%ish. Not exact, obviously, but it gets you in the ballpark.
Our Spending Breakdown, Per Person
$680 - Lodging (9 nights)
$462 - Flights (Orlando —> Reykjavik and back)
$340 - Activities (Blue Lagoon with drink and face mask, Jokulsarlon Lagoon kayak + glacier hike, speed boat whale watching in Husavik, and Laugarvatn Fontana Geothermal Bakery tour/tasting)
$251 - Restaurants (including an epic Viking dinner with axe throwing and an overpriced meal in a Greenhouse)
$240 - Rental car (hybrid)
$97 - Gas
$73 - Souvenirs
$55 - Abbott’s BinaxNOW rapid, proctored COVID tests (1 before, 1 during the trip — per travel requirements at the time)
$49 - Groceries
$39 - Travel insurance
$15 - Unlimited data sim card (which we used as a hotspot)
$4 - Parking
----
=$2,305 total/person**The cost of lodging, rental car, gas, and sim card were split between 3 travelers
Not bad, eh?!
One final note: If I were to take friends back to show them “the best of Iceland” (which I hope to!), I wouldn’t road-trip the full Ring Road again. It was a cool thing to do, but our favorite experiences were all in the southern half of the island (between Snaefellsnes Peninsula and Jokulsarlon Glacier). So, I’d advise you to plan for a week (minimum) in the southern half of the island. It’ll mean less time spent driving (which will also save on costs) and more time for hiking and hot springs!
If, however, your heart is set on driving the full Ring, I’d recommend committing to at least 10 nights. Our 9 felt rushed and left no margin for weather delays, so we had to skip a few things towards the end. You might spend another $100-200 per person, but it will be worth it.
I hope the nitty gritty deets of this post give you the reference points that you need to budget for your own magical adventure in the land of Ice and Fire!
HMU if you have any questions and HAPPY TRAVELING!
