Yes, the rumors are true, Iceland is expensive as hell. When you start to prepare an Iceland budget plan, make sure you do a lot of research because it’s visciously different than what you may be used to paying for items. Gas is more expensive, food is more expensive, and forget about alcohol completely! But there are ways that you can cut down on overall costs of the trip! Iceland’s currency is the Icelandic Krona. 1 USD is about equal to 100 Krona so it’s quite simple to convert in your head. (Ie; 18,000 KR = $180 USD)
Tip #1: Don’t travel during the high season or June-August. You’ll have much better luck saving money if you travel April/May or September/October.
Wow Airlines is a budget airline who pretty much is single-handedly increasing the tourism in Iceland! They are constantly offering cheap overnight flights, especially from cities like Boston, where a flight to Iceland is only a 5 hour plane ride away!
To get notice of flights like this, sign up for emails from Wow Airlines, as well as newsletters like Scotts Cheap Flights, Next Vacay and AirfareWatchdog. Having a steady flow of flight alerts to your inbox will be the best way for you to score cheap flights! That’s how we found out about the tickets we scored out of Boston!
ProTip: The more flexible you are, the better. We adjusted our trip from Wednesday to Wednesday rather than Saturday to Saturday to save money.
The downside of flying with a budget airline is the extra fees they throw on everything. We chose to pay the extra for choosing seats and having carry-on luggage, but skipped the checked bag and extra leg-room. These budget airlines also do not provide any food or drink, so come prepared by bringing snacks and filling up a reusable water bottle in the airport, that way you won’t be tempted when the snack cart rolls by!
Estimated cost for my round trip flight (Boston to Keflavik), seat choice and carry-on luggage: $315.
When figuring out your Iceland budget, accommodations will play a huge part in how quickly it adds up. Iceland is rapidly growing to keep up with the booming tourism, so hotels and guest houses are popping up everywhere. However, if you’re going to want to save money, you’ll have to try to book early, especially if you’re planning on traveling in the summer months. We traveled in April and already found that some of the cheaper places were already completely booked a couple months in advance. I’d recommend booking way in advance if you can afford it.
Hostels, Airbnbs, and Guest Houses are going to be your best options for accommodations as you drive around the Ring Road. While we were booking, we were constantly jumping between Hostelworld.com, Airbnb.com and Booking.com to try to find the cheapest option in the area we wanted to stay in.
ProTip: You might be limited to only guest houses in certain areas of the ring road where the only thing for miles is farmland! You’ll find most of these on booking.com.
We stayed in hostels in Vik, Akureyri and Skykkisholmur, and opted for Airbnbs in Akranes and Reykjavik. I know that hostels don’t appeal to everyone, but we were able to score beds for as cheap as $35 each for a night! In smaller towns like Vik on the south coast, there aren’t a lot of options to choose from so we had to get a private room in a hostel which cost us $88 each. Not bad, but not ideal!
The Airbnb website gives you the option to choose whether you’d like a full house or apartment, or if you’d be fine with a private room in someones house. We opted for the latter option which is usually more affordable. Both experiences were great, with a shared kitchen, all the supplies you could possibly need and convenient locations.
Estimated cost for 6 nights of Accomodations at Hostels and Airbnbs: $600 for 2 people. ($300 each)
If you’re plan is to explore the Ring Road, then you have two major options: Either rent a car or a camper van! If you’re feeling extra adventurous, you can upgrade to a 4×4 SUV for a bit more money but it opens up a world of new places you can explore.
We opted for the smallest rental car we could find with pick-up/drop-off right from Keflavik Airport. Most of the small rental cars will run around $35-75 USD a day. These cars will probably only work for 2 people traveling together though. You’ll need to upgrade to a larger car if you’re traveling with a larger group. If you opt for a 4×4 vehicle, prices will range from about $65-$125 a day and the price of gas will go up as well.
If you choose to go the route of the camper van, the daily rate will be MUCH higher than a regular rental car, however, you’ll be saving on accommodations! So it’ll be worth your time to do the research and compare options. Van prices can range drastically depending on what you’re looking for and who you’re booking with so you’ll definitely want to spend some time shopping around. Some of the companies I’ve heard good things about are Happy Campers, Campervan Iceland and Go Campers. This is a great option for saving money because you can cook in your van as well.
In terms of insurance, I’ve read a lot of contrasting information about what to pay for. Companies will try to offer you a million different types of additional insurance, that you more than likely can get away with not having. The car company we rented from had the regular CDW insurance included, and we had bought travel insurance through World Nomads as well, so we felt covered. Depending on what time of year you are going and how far off the beaten path you will be traveling, you’ll definitely want to consider gravel insurance as well.
ProTip: Also consider renting the $10-20 a day WiFi in the rental car. We thought we didn’t need it, but then quite often through the trip, I found myself wishing I had it!
The last thing you’ll need to consider for the “Getting Around” part of your Iceland budget is gas! It’s viciously more expensive than what we pay here in the U.S. so budget accordingly. Everything I read prior to leaving said to estimate for about $60 a day in gas. We might have beat that because we had the smallest, most fuel efficient car in all of Iceland, but that’s never guaranteed!
Estimated cost for a 7 day mini-car rental and CDW insurance: $181 total ($90 per person.) Estimated cost of gas for 7 days: $300 ($150 each.)
Food and Drinks
Okay, prepare yourself. This is where the money disappears. Iceland can literally not grow anything themselves up there so they basically have to import everything. While on our road trip, we had planned on buying food at a grocery store for the most part to save money and even THAT proved to be pricey. Keep an eye out for the bright yellow Bonus Grocery stores for the “cheaper” prices. They’re pretty common throughout the country in the bigger towns.
We bought bread, peanut butter, jelly, chips, salsa and a small bag of pasta with pesto for our first night. In an effort to be healthy, we went to go look at buying chicken, and found (3) small chicken breasts to cost $20 USD. That’s when we looked at each other with wide eyes and realized what we had gotten ourselves into!
For the next several days, we lived off a diet of PB&Js, gas station hot dogs, hostel breakfasts and trail mix that I had brought from home. I think we only treated ourselves to meals out a handful of times on our travels. Which as long as you don’t buy alcohol, the bills are somewhat manageable. We split a pizza one night for $20, got some bagels for breakfast another morning for $20 and treated ourselves to some seafood stews for $40ish total. It ranges but can be do-able.
ProTip: As unappetizing as “gas station hot dogs” sounds, do it. They are way better than anything you’d taste in America, they’re affordable, and they are SUPER convenient.
One thing that is important to know, is that a lot of the small town cafes don’t open up early, or on time for that matter. We couldn’t find a single place to grab food one morning and found ourselves eating PB&Js in our car before our glacier tour.
Water however is completely free everywhere you go. Icelanders laugh at tourists who purchase water bottles because they have the cleanest, coldest tap water in the entire world. Do yourself a favor, bring a reusable water bottle and drink the tap water!
My advice on alcohol? Just don’t.
I’m kidding, but be aware of the fact that the prices WILL be ridiculous. Treat yo’self as necessary to experience the local beers but don’t plan on going out and getting drunk every night. We purchased a bottle of whiskey from the duty-free shop at the airport on our way in to drink throughout the week which helped saved money. But for the most part during our road trip, we kept it to a minimum. Stay tuned for my next blog post where I dive into how quickly our money flew out the door during our 2-night stay in Reykjavik!
Estimated cost for food and alcohol during our 5 day road trip around Iceland: $450ish (About $200 each). Estimated cost of food and alcohol during our 2 day stay in Reykjavik: I have no friggin clue!
Excursions / Things to Do
We chose to only do one organized tour during our trip and cut down on costs that way. There are a million and one tours you can do all over the country, from Glaciers, to volcanic tubes, to ice caves, to horse back riding, to whale watching, etc. This could really add up if you try to do it all. We narrowed it down to a couple tours that we thought would be affordable and worth it then chose one and worked it into our schedule.
We opted for the Into The Glacier Tour out of Husafell. This tour was about 4 hours long and included a drive in a mega-glacier truck, and a guided tour 45m deep into a glacier. It cost $195 each but was well worth the money. AND it was one of the cheaper ones we had found!
Some of the other tours we considered were The Ice Cave Tour in Southern Iceland ($196 pp), the Lava Tunnel Tour near Reykjavik ($64 pp),and Vidgelmir Cave Explorer Tour near Husafell ($64 pp). This is only a few examples of the different types of guided tours you can go on. There were at least 4 different tour companies on the tip of Snaefellsnes Peninsula alone!
You can find some lower prices for guided “bus” tours leaving from Reykjavik, or you can dish out several hundred dollars for epic glacier hiking tours with all the gear and small groups of extreme adventurers! You just have to find what’s right for you!
The great thing about Iceland is there is SO much to see and explore, that you can easily do the entire trip without a single guided tour. Plenty of the sight seeing in the north is still undeveloped, unlike the areas around Reykjavik. Go off the beaten path a bit to avoid the prices and the bus loads of people.
Estimated cost for glacier tour: $190 per person. Estimated cost for ALL of our other sight seeing? $0.
It’s VERY important to go into your trip with an Iceland Budget plan. Do the research and make a plan ahead of time because if you try to wing it, it can easily get out of a hand very quickly!
Do you have any money saving tips for traveling to Iceland? Leave them below in the comments! I’d love to hear what you came up with! Until next time…