Iceland on a Budget: It’s Very Doable

couple smiling for the camera in iceland

Iceland has plenty of lava, so it's no surprise it's a tourist hotspot, especially for Americans. It's tough to resist the island's landscape — volcanoes, waterfalls, and hot springs around every corner. It can be an expensive trip. Can you do Iceland on a budget? Yes. Yes, you can.

Iceland is an island close to the Arctic Circle, so many resources (like crops) are imported. It's a topic that tour companies like Troll Expeditions regularly discuss with clients to help them manage budgets. So, for example, an average seated meal costs between $15 and $30, or more, at nicer restaurants, according to Guide to Iceland.

Tourist ride horse at Kirkjufell mountain landscape and waterfall in Iceland summer. Kirjufell is the beautiful landmark and the most photographed destination which attracts people to visit Iceland.
Image Credit: Shutterstock.

Iceland on a Budget

The good news is that many of Iceland's natural wonders are free to the public. This includes popular destinations like SkogafossBlack Sand Beach, and Thingvellir National Park. So, when you compare that to other destinations, free tourist attractions are one of the advantages of visiting Iceland.

To travel cheaply in Iceland, you'll need to be strategic. The best way to organize your approach to budgeting for Iceland is to be frugal with stuff you won't remember on your deathbed.

Think of it this way. Which scenario is more likely: will your memories be filled with regret over drinking cheap gas station coffee or missing out on taking a Super Jeep through Landmannalaugar in Iceland's Highlands?

Choose Flight Frequency Over Biscoff Cookies

They're so light and buttery – we get it. But focus because there's a lot of money at stake. That money is better spent on rugged Icelandic adventures.

PLAY markets its flights as a no-frills travel experience. This is up for some fun debate, considering the company headquarters is in Reykjavík. Iceland is known as the land of fire and ice, so one could argue that the brand's core business is thrills.

That aside, the flights are priced to woo you into giving up most of the “extras” we enjoy on airplanes. For example, you can save hundreds of dollars by giving up that weird, useless airplane pillow.

If you can't live without the extras, Icelandair

If you need the extras, then Icelandair is your best bet. Some folks have long legs or circulation challenges that require more legroom. Some people like to prioritize the additional services like meals, which are surprisingly crave-worthy on Icelandair. They're still competitive in price. The lucky people who fly from New York or Boston sleep through an easy five or six-hour direct flight.

Icelandair also offers a stopover program. This allows travelers to include a one or multi-day stopover in Iceland for no extra charge.

Last-minute Rental Car? You'll Have More Luck Riding a Unicorn

Once your flight is booked, it's time to focus on one of the other more significant expenses – a rental car. The car rental companies are located near the airport. Choose a company that offers a free – and frequent – shuttle. And look for things like unlimited mileage.

A cheap car rental in Iceland is tough to find, but Lava Car Rental offers discounts for longer rentals. Plus, they have a lot of vehicles. This doesn't sound cool, but wait until you try booking a rental car in Iceland. Most companies sell out quickly. The bottom line is that car rentals in Iceland should never be an afterthought.

This is a local company, meaning the folks in that pickup office are another free resource. So ask them all your burning questions on how Icelandic locals save money. And before you leave, you'll get a keyfob that provides a discount at major gas stations. They give you a little pamphlet with free coffee coupons as well.

Gas Station Coffee Is Your New Superpower

Focus on the landscape and adventures. Sure, a nice meal is memorable. But if you keep most of the meals cheap, you'll save a lot of money. Before your trip, research the restaurants where you'll be visiting.

You don't want to go grocery shopping hungry. Apply that truth in Iceland as well. Don't spend the morning taking selfies at Skógafoss, realize you're famished, and then try to find cheap food. You'll likely give up and overspend because you're too hungry to wait.

It's also important to note that many Iceland gas stations have excellent food courts. So, don't shy away from adding some gas station grub into the budget strategy. The vibe at most Icelandic gas stations surprises most travelers. They're spacious and clean, and the food is equal to most casual restaurants.

Lamb soup in a gas station? Why not?

You might be leery of ordering a bowl of lamb soup in a typical gas station. But make a pitstop at an N1 Station and order the traditional Icelandic Meat Soup. It's a delicious and affordable meal.

Also, coffee drinkers should pack a refillable insulated mug. This helps to keep the coffee hot and fresh during long drives. You can skip that bottled water, though. Most of Iceland's water is fresh spring water, so publications such as Iceland Magazine celebrate that Iceland does not need to treat its water with chemicals.

Two Words: Merino Wool

couple smiling for the camera in iceland
Image Credit: PLAY Airlines.

Regardless of the time of year, the weather in Iceland changes frequently. The average summer temperature is 54°F, and it averages in the mid-30s in winter. The tricky part is that it changes without much notice, so you can expect sun, rain, wind, and possibly snow any time of year, especially at higher elevations. This leads to overpacking.

Rather than plan different outfits for each day, plus backup options to pair with all those combinations, keep it simple.

Avoid dressing in layers

The best plan is to avoid dressing in layers. This will allow you to control your comfort level and dampness better away from your skin. Merino wool, a favorite among hikers, is an excellent option because it insulates, wicks moisture away from the skin, dries quickly, and is odor resistant. Companies like Icebreaker and Royal Robbins offer options ranging from base layers to casual sweaters.

Investing in a few pieces of merino wool will save money and frustration. Look for neutral colors or hues that complement items you already own. Plan to re-wear these wool pieces throughout your trip. They're appropriate for the changing weather conditions and will save you from buying many unnecessary outfits.

Plan Your Visit to Iceland on a Budget

Planning and embracing a minimalist approach is the best strategy for visiting Iceland on a budget. Limit unnecessary extras, like fine dining and clothing purchases made with Instagram in mind. Instead, keep it simple and enjoy Iceland's free tourist attractions.

This article was produced and syndicated by Wealth of Geeks.