Iceland on a Budget: 6 money saving tips for visiting Iceland

Girl in yellow rain jacket against black sand in Iceland

Planning a trip to Iceland? Don't break the bank with these money saving tips!

For many (like ourselves), Iceland is a dream destination. Unfortunately, due to its crazy expensive prices, visiting seems out of reach for many. We recently spent 2 weeks in Iceland and because we made conscious decisions ahead of time regarding how to stick to a budget, we spent less money in Iceland than we did in 2 weeks in Mexico. How? We stuck to a strict budget for Iceland and followed these six simple tips.

Why travel on a budget in Iceland?

Maybe you’re one of those people who will take every red eye flight with multiple stops and crazy long layovers to make your travels happen. We get, we’ve been there and even on our trip to Iceland we made some pretty crazy flight choices to save money. But here’s the main reason we make budget decisions while traveling: we want to save our money for the experiences.

Sure, there are foods you have to try in Iceland and sometimes the ease of staying in a familiar hotel chain is just easier, but oftentimes we’re saving our money to try as many experiences as possible while traveling and to splurge on fun/cool places to stay. For example, in Iceland we soaked in 4 different lagoons and I don’t regret it a bit. In fact, I wish we had soaked in a few more. Fun experiences like lagoons, spas, fancy hotels, and quirky Airbnbs add up, but if you’re like us, splurging is worth it and a part of the experience when traveling to a new places. In order to make room in the budget for the splurges in Iceland, we did six different things to save money.

6 tips for traveling to Iceland on a budget:

Pack snacks

Before you even leave home, run by the grocery store and grab a few snacks that will likely be more expensive overseas. Have a favorite protein bar or granola? Bring it! It’s expensive to import things to Iceland, so if you head over there planning to just buy your favorite snacks upon arrival, it’ll be expensive. Packing snacks is such an easy way to do Iceland on a budget.

Snacks like protein bars, granola, backpacking meals (if you’re heading into the backcountry) and even good instant coffee are great options to have on hand while in Iceland. 

Not only does it save money when you’re traveling in Iceland, but as you travel and eat down your snacks, you’ll have more room to bring home souvenirs. 

Shop at Bonus

Want to eat on a budget in Iceland? Grocery stores will save you so much money! An Icelandic local taught me about Bonus on the plane ride to Iceland. Bonus is the cheapest store on the island for food, and they can be found all over the country. You’ll recognize the stores for their bright yellow exteriors and the hot pink pig logo. We always recommend stopping into Bonus for picnic lunch foods or even a sweet treat after a hike. One of the best budget tips in general for traveling is to buy meals directly from grocery stores instead of restaurants (we do this all the time and it keeps us eating smaller portions and healthier options, too). 

Duty free for alcohol

If you plan on consuming alcohol while in Iceland, stop by the duty free shop in the airport. There are a couple duty free shops at KEF airport, but we learned another tip from the Icelandic lady on the plane: skip the first duty free shop and go straight to the one in baggage claim! Go, shop around, and by the time you’re done, your bag will be waiting for you.

Alcohol is expensive, so if you’re sure you’ll be consuming some while on the island, go ahead and grab it here. Truthfully, we don’t consume a lot of alcohol in general, partially because it’s expensive. That being said, we do appreciate a good beer after a hike and the duty free store was a great way to get beer and stay on a budget in Iceland.

Rent the smallest car you can find

I know, larger cars are more comfortable, but [generally] the smaller the car, the cheaper the car will be. While we were in Iceland (September 2022) petrol was ~$8.80 USD a gallon and we were super thankful for the tiny little Hyundai Enterprise set us up with. If you plan to drive the entire Ring Road, you’ll be glad you opted for the gas saver option! Sometimes staying on a budget means being a little less comfortable, all for the sake of travel and adventure. 

Consider camping instead of hotels

I know, I know, not everyone is into camping. If you like camping and have some gear already, this is a huge way to stick to a budget while in Iceland! While many people opt for campervans, we found them to be too expensive to justify on this trip. We already owned a small backpacking tent, sleeping bags, and sleeping bags, so we packed a backpack with our camping gear and saved hundreds of dollars camping instead of staying in hotels. The average tent spots in Iceland range from $10-30 USD. Most have hot showers, toilets, kitchen sinks, and even laundry. Sometimes laundry and showers are an additional charge, but usually very affordable at around $2 per use. Some campgrounds are even set up like hostels with kitchens, heated common areas, wifi, and more to keep campers comfy when the weather gets iffy. 

We have an entire blogpost all about camping in Iceland including our gear, favorite spots, and other tips and tricks, so be sure to check it out HERE if you're interested in budget travel option for Iceland.

Look for budget food options

We’ve always scoured Google Maps for restaurants with the single $ sign, but our friend Amanda (a fellow travel content creator) taught us a super easy tip to save a bit of time searching for budget food options while traveling. Instead of checking each restaurant individually or filtering food options on Google Maps by price, try searching “cheap eats” on the map. It’s likely other travelers have commented those very words in the reviews and/or the restaurant itself has labeled itself as a budget friendly option. If you’re going to eat out while sticking to your budget in Iceland, this is a good way to do so!

Final thoughts

Iceland is definitely one of the most expensive countries in the world ot travel to, but that doesn't mean it's impossible to travel on a budget. Plan ahead and be willing to travel a little differently to experience Iceland!

What are some ways you save money while traveling? We’d love to hear your suggestions in the comments below!

Iceland on a Budget: 6 money saving tips for visiting Iceland | Chris and Sara

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