Europe/ Iceland/ Travel

How to plan an affordable trip to Iceland

Beautiful but expensive: the two ways everybody I spoke to about Iceland described the country.

While it’s true that it’s not a cheap destination, I can virtually guarantee that your trip to Iceland will be worth every penny.

That being said, if you’d like to plan a more affordable trip to Iceland, it’s absolutely doable with a few tips, tweaks and considerations.

The amazing part about Iceland is that its outdoor wonders rule the roost and so many of them are absolutely free. So, if you’re ready to immerse yourself in the great outdoors, the land of ice and fire (shall I go on?), let’s dive into this guide packed with Iceland budget travel tips.

How to budget for your trip to Iceland

How to plan an affordable trip to Iceland

1. Choose when to travel

Your travel dates can seriously impact how affordable your trip to Iceland can be.

Late June – early September is by far the most popular time to visit Iceland. Although not your typical summer destination, longer daylight hours and more favourable weather conditions make it a beautiful time to explore Iceland in all its greenery.

Winter is also popular, particularly for those searching for a festive short break, skiing trip or Northern Lights spotting excursion.

Shoulder seasons spring and autumn are typically the most budget-friendly times to visit Iceland. You’ll find lower prices for accommodation and fewer crowds, but the conditions can be unpredictable.

That being said, there are unavoidable perks of travelling in peak season. For example, we wanted to drive around Iceland’s ring road and with many northern roads closing during wintery weather, I knew it would be much easier in summer. A summer road trip also meant we could hire a smaller car instead of a 4WD – a trade-off to consider if you’re planning travel purely around budget.

Toyota Aygo Iceland

2. Set a budget

Without an idea of how much you’d like to spend, travel costs can easily spiral – just like in other areas of life.

The most effective way I’ve found to budget for travel is to plan a rough itinerary of approximate dates and route. Then, you can get an idea of the average flight, accommodation and transport prices, as well as scope out any must-do activities in Iceland.

This takes a bit of patience, but always gives me a good idea of how much a trip will cost. Then, I’ll read plenty of blogs for research about in-destination spends and make a mental note of any useful tips.

A good way to keep an eye on your budget during your trip is to transfer your approximate budget to a different card. This can make it easier to check if you’re on track. Don’t forget to make sure it’s a fee-free card to avoid extra charges! We didn’t use any cash on our trip to Iceland, although it’s technically always good practice to have a small amount of change just in case.

Behind Seljalandsfoss

3. Book flights in advance

Having worked for flight providers in the travel industry for five years, I firmly believe the best time to book a flight is soon after they’re released or during a sale. There are exceptions to this rule, but generally the more seats are sold, the higher the fare class and price becomes.

The main times to bag a great sale fare include the end of December/early January, March/April and September, particularly on long-haul airlines. Budget airlines are a little more sporadic so I’d recommend signing up to their newsletters for notifications of their latest offers.

I pretty much always use Skyscanner to look for the best flight deals, including the show whole month option to find the cheapest dates. However, be careful with this – some third party sites linked via Skyscanner aren’t great at handling any type of disruption, so I’ll virtually always use the airline’s own website to book.

We flew from Manchester to Reykjavik with easyJet, including their 15kg checked luggage which was cheaper than the standard 23kg bag.

Affordable flights to Iceland

4. Choose affordable accommodation

This is where I often make big savings on our travels. While I’m an absolute sucker for a stunning hotel, you can undoubtedly still have a great experience in a hostel or guesthouse. I make it my personal mission to find clean, affordable and ideally good-looking accommodation and rarely have a bad experience. Here are a few tips for finding the best on a budget in Iceland:

Booking.com Genius discount: I book pretty much all my travel using this website, although often I check the hotel’s website too in case they offer best-direct rates. If you travel fairly often, the Genius rewards are well worth it as rooms are often discounted, have free upgrades or even include breakfast.

 

Search criteria: Don’t get overwhelmed by a huge list of hotels, but use filters to narrow down your options. I often set a maximum price, narrow it down to only 8/10+ reviews, private bathroom and only available properties.

Trust the reviews: I always read at least the most recent reviews to get a decent idea of what to expect. You’ll always find cranks on there so don’t let every little thing put you off, but generally consistent comments will give you an accurate picture of whether the accommodation will work for you. I also use blog itineraries to find hotel ideas, but only if somebody has actually stayed there!

In Iceland, we had to opt for shared bathrooms in a couple of places to stay within our budget. However, the great thing about travelling Iceland, is that everybody is generally more mature than when you’re backpacking in Australia, for example. Wherever I went, everybody treated shared kitchens and bathrooms with respect and facilities were clean and quiet, as most people hit the road early. We met everyone from young solo travellers to families and retired married couples in hostels and guesthouses during our 10 days in Iceland.

Laura in waterproofs Iceland

Want to know my top affordable accommodation picks in Iceland? There’s a blog post coming so check back soon!

5. Cook your meals

Sticking with the accommodation theme for a minute, I saved a ton of money by self-catering the vast majority of the meals in Iceland. Eating out is really expensive and for once in my travels, I wasn’t excited about the food in Iceland so I personally didn’t think it was worth it to splash out here.

Stay in guesthouses, hostels and Airbnbs with kitchen facilities and buy groceries in affordable supermarkets like Bónus and Krónan. We brought a foldable insulated grocery bag with us to keep our items cool from place to place – although it never really gets hot, so a few hours doesn’t do too much harm!

We also couldn’t resist stopping for the odd gas station hot dog: while they aren’t the most filling, they make a good snack or lunch on the go.

Iceland hot dogs

Our formula was pretty much: yoghurt and granola for breakfast, cheese sandwiches for lunch and either pasta or beans on toast for dinner, all garnished with some fruit and plenty of snacks for long drives. We got addicted to the Pagen Gifflar Cinnamon Rolls! We definitely could have been more creative and desperately needed some vitamins by the last few days. However, we wanted to save most of our time for adventuring, not cooking.

If you’re wanting to splash out for a couple of nights, Iceland has some absolutely gorgeous high end restaurants in Reykjavik. We didn’t go super high end, but we did celebrate our engagement (eek!) with dinner at Restaurant Varma. Located just off the ring road, some of their gorgeous meals are cooked in the thermal springs’ heat.

Restaurant Varma

6. Choose free and low-cost activities

The absolute best thing about Iceland is that you can explore some of the world’s most beautiful lagoons, waterfalls, cliffs, black sand beaches, thermal rivers and more for free. Generally, unless you take a tour, the only cost will be your parking fee of around 1000 ISK.

Of course, if you want to, you could also spend an absolute fortune on activities in Iceland. With many of these being those bucket list, once in a lifetime dreams – think glacier hikes, helicopter rides, scenic flights or snowmobiling. While you may be planning an affordable trip, you don’t want to miss out so splash out on your highest priorities and consider alternatives for the rest.

For us, snorkelling between tectonic plates at Silfra was our non-negotiable, with whale watching coming in close behind. Both were worth every penny! On the rest, we found ways to save – for example, choosing the lesser known yet stunning Vok Baths instead of the Blue Lagoon and contenting ourselves with hiking close to the glacier lip without actually setting foot on it.

South Iceland glacier
We didn’t pay a penny for this most epic view – not even parking!

Want a more organised group experience? There are a great range of tours in Iceland that can have you ticking off a couple of bucket-list activities in one go! Depending on your plans, this can work out cost effective, so shop around to get the best deal. As well as searching for the best-reviewed providers, I always check Get Your Guide too.

A note on geothermal pools: Some of Iceland’s most well-known attractions are the Blue Lagoon, Sky Lagoon etc – some of which can charge a hefty fee. I’d absolutely encourage you to visit at least one of these for the dreamy experience (Secret Lagoon was perhaps the most luxe of the ones we visited) but many public pools and geothermal baths are affordable and offer a unique Icelandic experience.

Reykjadalur geothermal river and Seljavallalaug pool on the South Coast are totally free, plus you’ll just find an honesty box at this natural ‘hot tub’ on the edge of the Westfjords.

Guðrúnarlaug

7. Consider your transport

Aside from accommodation, transport could be your biggest cost in Iceland. Some of the most popular options are listed below.

Day tours: The simple, yet more expensive option for travellers who don’t want to think too much! Honestly, if you’re wanting to see lots of places in Iceland, it’s often much simpler and cheaper to rent a car yourself. I’d only recommend tours if you’re staying in Reykjavik for a long weekend and want to see lots of places without driving yourself.

Public transport: Iceland’s public bus system is called Strætó – you’ll recognise them by their yellow colour. They operate across the country, although timetables can vary seasonally and can be disrupted by bad weather. We didn’t use the bus so I personally can’t share any experiences, but I have heard of people who travel around this way – although it does give you less flexibility to stop freely along the way.

Car rental: As I covered earlier, this is how we – and the majority – of people travelling the ring road get around Iceland. While car and campervan hire isn’t cheap, particularly in the summer, it is well worth the investment to avoid being limited to only the most touristy of destinations. Watch out for insurance – while you may be tempted towards the cheapest package, it’s worth considering the different levels of cover, even if you aren’t driving on F roads. We upgraded ours and when we encountered gravel roads in north and west Iceland, it was well worth the peace of mind.

Thanks for sticking with me this far! Now you’re armed with seven wonderful ways you can plan an affordable trip to Iceland, without breaking the bank. Have a wonderful trip!

Laura x

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