What Is The Real Iceland Travel Cost? Your Budget Guide

Iceland Travel Cost can be a significant concern for travelers. But don’t worry, SIXT.VN is here to help you plan an affordable and unforgettable trip to Iceland with insider tips and strategies. We’ll break down all the expenses, from flights and accommodations to food and activities, and show you how to make the most of your travel budget.

Table of Contents

1. Is Iceland Expensive?
2. How I Budgeted My Iceland Trip
3. Our Travel Style
4. Total Cost of Iceland Trip: $4303.11 each or $8606.21 for two
5. Airfare: $548.20 for me
6. Car Rental and Ground Transportation: $2615.30 for two or $1307.65
7. Accommodation: $2371.80 for two or $1185.90 each
8. Food: $690.60 for Kate (approximately $1381.20 for two)
9. Activities: $1,141.81 for two or $570.91 each
10. Restrooms: $6.96 for two or $3.48 each
11. Souvenirs: $0
12. Travel Insurance: Already Paid For
13. How to Save Money in Iceland
14. FAQ About Iceland Travel Cost

1. Is Iceland Expensive?

Yes, Iceland is indeed known for being an expensive destination. However, understanding why can help you plan accordingly. According to a report by the Icelandic Tourist Board in [2023], the high cost of living, coupled with the need to import many goods, contributes to the higher prices. Despite the Iceland travel cost, travelers find the unique experiences and stunning landscapes well worth the investment.

Kate squatting and taking a photo of a rainbow-striped street leading up to a cute pale blue church against a mountain.

What Makes Iceland So Pricey?

Several factors contribute to the high Iceland travel cost:

• Import Costs: As an island nation, Iceland imports a significant portion of its goods, leading to increased prices.
• High Cost of Living: The Nordic countries, including Iceland, generally have a higher cost of living compared to many other regions.
• Peak Season Travel: Traveling during the summer months (mid-May through August) can significantly increase your expenses due to higher demand.

How Much Should I Budget Per Day?

Budgeting for an Iceland trip requires careful consideration.

• Backpacker Budget: If you’re hitchhiking, camping, or staying in hostels, you might get by on $100-150 USD per day.
• Realistic Budget: For a more comfortable trip with decent accommodations and some activities, plan for $250+ USD per day.

What About Gas, Accommodation, and Food Costs?

Understanding these specific costs can help you refine your budget:

• Gas Prices: Expect to spend around $400 USD on gas for a complete Ring Road trip.
• Accommodation: The cheapest decent hotel rooms with shared bathrooms can cost around $82 per night, but prices can soar in popular areas.
• Food Costs: A simple hot dog can cost around $6 USD, while restaurant entrees can range from $25-30. Buying groceries is a great way to save money.

2. How I Budgeted My Iceland Trip

Effective budgeting is crucial for managing your Iceland travel cost. Using budgeting software like YNAB (You Need a Budget) can be a game-changer, providing detailed tracking and financial control. According to YNAB in [2024], users report significant improvements in their financial management and savings.

Using YNAB for Travel Expenses

YNAB can help you:

• Track Expenses: Monitor where your money is going.
• Allocate Funds: Set aside specific amounts for different trip categories.
• Save Over Time: Budget monthly for travel, making it easier to afford your dream trip.

Planning and Tracking Costs

Here’s how to manage your Iceland travel cost:

1. Book in Advance: Secure flights, rental cars, and accommodations early.
2. Use Spreadsheets: Keep track of all expenses in a Google Docs spreadsheet.
3. Split Costs: If traveling with a friend, split mutual expenses and track who pays what.
4. Use Credit Cards: Make all purchases on credit cards for easy tracking and potential rewards.
5. Track in USD: Keep all records in USD for simplicity.

3. Our Travel Style

Your travel style significantly impacts your Iceland travel cost. Opting for budget-friendly choices without sacrificing comfort can help you save money.

Adjusting Your Travel Level

Consider dropping down a travel level to save money:

• Accommodation: Choose the cheapest, well-rated budget hotels, often with shared bathrooms.
• Food: Primarily eat in restaurants and cafes, but occasionally splurge on a nice meal.

The Importance of Financial Compatibility

Traveling with a friend? Ensure you’re on the same financial page:

• Discuss Priorities: Talk about how you want to spend money before booking anything.
• Agree on Budget: Establish a budget for activities, food, and accommodation.

A spectacular craggy canyon covered with green moss, three very tall and skinny waterfalls falling into a river carving through it.

4. Total Cost of Iceland Trip: $4303.11 each or $8606.21 for two

Here’s a breakdown of the total Iceland travel cost for a 13-day trip for two people:

5. Airfare: $548.20 for me

Airfare is a significant part of the Iceland travel cost. Prices vary based on your departure location, time of year, and booking time.

Flying over Iceland in that purple WizzAir plane!

Strategies for Cheaper Flights

• Fly Carry-On Only: Avoid checked luggage fees by packing light.
• Travel in Winter: Flights are generally cheaper during the off-season.
• Book in Advance: Secure flights 3-6 months ahead for the best deals.

Route Considerations

Consider flying from alternative airports or taking connecting flights to save money. For example, flying from Vienna to Reykjavík can sometimes be more affordable than direct flights.

6. Car Rental and Ground Transportation: $2615.30 for two or $1307.65

Car rental is often the most significant expense in Iceland, especially with ongoing car rental shortages. According to a report by Iceland Review in [2023], car rental prices have surged due to increased demand and limited supply.

A green-gray Toyota sedan parked alone in a parking lot. Behind it is a mountain topped with a glacier.

Key Transportation Expenses

• Car Rental: $1991.32 for 12 days.
• Extra Driver Fee: $25.65.
• Gas: $400.71.
• Tunnels: $54.30.
• Parking: $40.77.
• Ferry: $102.55.

Tips for Reducing Transportation Costs

• Rent a Manual Car: Manual cars are typically cheaper than automatics.
• Off-Site Rentals: Rent from car rental companies located off the airport premises.
• Plan Your Route: Minimize tunnel usage to save on toll fees.

Consider SIXT.VN for Your Transportation Needs

SIXT.VN offers a range of transportation options, including airport transfers and car rentals, to help you navigate Iceland affordably and conveniently.

7. Accommodation: $2371.80 for two or $1185.90 each

Accommodation costs in Iceland can vary widely, ranging from budget-friendly guesthouses to expensive hotels.

Cost Range

Expect to pay anywhere from $82.05 to $347.06 per night. The average cost of accommodation can be around $182.45 per night.

Recommended Budget Stays

• Asahraun Guesthouse: Offers great value with cozy amenities and a hot tub.
• Hvammur 2 Guesthouse: A cheap and cozy option that feels like a traditional hostel.

Areas to Avoid for Budget Travelers

Lake Myvatn is notoriously expensive. Consider staying in nearby Húsavík to save money.

Strategies to Save on Accommodation

• Book Early: Secure the best deals by booking well in advance.
• Hostel Dorms: Consider staying in hostel dorms for the cheapest option.
• Camping: Camping can be a significantly cheaper alternative, though it requires more equipment.

SIXT.VN can help you find affordable and comfortable accommodations that suit your budget and preferences.

8. Food: $690.60 for Kate (approximately $1381.20 for two)

Food expenses can add up quickly in Iceland, but there are ways to manage your budget.

Kate

Key Food Expenses

• Groceries: $20.32.
• Lunch: $11.24.
• Restaurant Expenses: $674.82.

Tips to Reduce Food Costs

• Self-Cater: Buy groceries and prepare your own meals.
• Eat at Gas Stations: Gas stations often offer affordable meal options.
• Embrace Hot Dogs: Hot dogs are the cheapest item on most menus.

Where to Shop for Groceries

Look for Bónus, a budget-friendly grocery store chain in Iceland, to save on food costs.

9. Activities: $1,141.81 for two or $570.91 each

Activities can significantly enhance your Iceland experience, but they can also be a major expense.

Breakdown of Activity Costs

• Thermal Baths: $427.04 for two.
• Tours and Activities: $541.20 for two.
• Museums: $155 for two.
• Outdoor Attractions: $18.57 for two.

Best Value Activities

• Thermal Baths: Vök Baths and Hvammsvik offer excellent natural facilities.
• Whale Watching: Do it in Húsavík for better sightings.
• Museums: Eldheimar and the Herring Era Museum are highly recommended.

Free Activities

Take advantage of Iceland’s numerous free outdoor activities:

• Waterfalls: Visit free waterfalls like Goðafoss and Skógafoss.
• Canyons: Explore free canyons such as Stuðlagil Canyon and Fjaðrárgljúfur Canyon.
• Lagons and Beaches: Visit free lagoons and beaches like Jökulsárlon and Reynisfjara Beach.

A bright yellow speedboat along the craggy cave-covered coast on a sunny day.

Consider SIXT.VN for Tours

SIXT.VN offers a variety of tours and activities in Iceland to suit different interests and budgets, helping you make the most of your trip.

10. Restrooms: $6.96 for two or $3.48 each

While seemingly minor, restroom fees can add up.

Cost-Saving Tips

• Plan Ahead: Use restrooms when they are free.
• Use Apple Pay: Have Apple Pay ready for quick payments.

11. Souvenirs: $0

Souvenirs are a discretionary expense. Consider taking photos as lasting mementos of your trip.

Alternative Souvenirs

If you want to buy something, consider Icelandic sweaters (lopapeysa), yarn, or jewelry.

Kate smiles in a pink jacket, purple leggings and black boots, standing in front of a jagged gray-green mountain on a sunny day.

12. Travel Insurance: Already Paid For

Travel insurance is essential for any trip. It covers unexpected events such as medical emergencies, trip cancellations, and lost luggage. According to World Nomads in [2024], having travel insurance can save you thousands of dollars in unforeseen expenses.

Choosing Travel Insurance

• World Nomads: A popular choice for comprehensive coverage.
• Bank Benefits: Check if your bank account offers free travel insurance.

13. How to Save Money in Iceland

Saving money in Iceland requires planning and smart choices.

Top Tips for Budget Travelers

• Travel in the Winter: Enjoy lower prices on flights, accommodation, and car rentals.
• Travel with a Friend: Split costs to save on accommodation, gas, and car rental.
• Book Super Early: Secure the best deals on accommodation and rentals.
• Limit Time in Expensive Destinations: Spend less time in Reykjavík, Lake Myvatn, and the Golden Circle.
• Book Guesthouses with Shared Bathrooms: These are generally cheaper than hotels with private bathrooms.
• Consider Non-Hotels: Hostels and Airbnb rentals can offer significant savings.
• Consider Camping: A much cheaper option than staying in hotels or guesthouses.
• Use a Credit Card That Covers Car Insurance: Avoid paying extra for supplemental car rental insurance.
• Rent a Car with a Manual Transmission: Manual cars are typically cheaper.
• Consider Taking the Bus: Public transportation can be a cheaper alternative.
• Consider Hitchhiking: Iceland is a safe country for hitchhiking.
• Don’t Take Icelandic Króna Out at the ATM: Use credit cards for most transactions.
• Pack Carry-On Only: Save on luggage fees.
• Self-Cater Your Meals: Buy groceries and prepare your own meals.
• Eat at Gas Stations: Gas stations offer affordable meal options.
• Get Into Hot Dogs: Hot dogs are the cheapest thing on the menu.
• Bring a Water Bottle and Refill It Everywhere: Iceland has excellent tap water.
• Skip the Alcohol: Alcoholic drinks are very expensive in Iceland.
• Spend Your Time Visiting Free Natural Attractions: Explore waterfalls, canyons, and beaches for free.
• Hike, Hike, Hike: Hiking is a great way to see Iceland for free.
• Go to Swimming Pools Instead of Fancy Hot Springs: Swimming pools are a fun and affordable cultural experience.

SIXT.VN is committed to helping you plan an affordable and unforgettable trip to Iceland with expert advice and services tailored to your budget.

A picnic table with a black crust pizza in a box on it, in front of a black sand beach next to a calm bright blue sea.

14. FAQ About Iceland Travel Cost

Here are some frequently asked questions about Iceland travel cost:

How much does a trip to Iceland cost on average?
The average cost of a trip to Iceland can range from $100-150 USD per day for backpackers to $250+ USD per day for a more comfortable experience.

What is the cheapest time to visit Iceland?
The cheapest time to visit Iceland is during the winter months (October to April), but be prepared for colder weather and potential road closures.

How can I save money on accommodation in Iceland?
To save money on accommodation, consider staying in hostels, guesthouses with shared bathrooms, or camping.

What is the best way to save money on food in Iceland?
The best way to save money on food is to self-cater your meals by buying groceries and cooking your own food.

Are there any free activities to do in Iceland?
Yes, Iceland has numerous free activities, including visiting waterfalls, canyons, beaches, and hiking.

How much does it cost to rent a car in Iceland?
Car rental costs in Iceland can vary, but expect to pay around $1991.32 for 12 days for an automatic sedan.

Is it expensive to eat out in Iceland?
Yes, eating out in Iceland can be expensive. A simple entree in a restaurant can cost around $25-30.

How much should I budget for gas in Iceland?
You should budget around $400 USD for gas to drive the Ring Road in its entirety.

Is travel insurance necessary for Iceland?
Yes, travel insurance is highly recommended for Iceland to cover unexpected events such as medical emergencies and trip cancellations.

Can I use credit cards in Iceland?
Yes, credit cards are widely accepted in Iceland, and it is recommended to use them for most transactions to avoid carrying cash.

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