How to Travel Iceland on a Budget

Iceland is an EXTREMELY expensive travel destination. It’s one of the most expensive countries in the world to travel. However, if you’ve traveled to any other countries in Scandinavia, Iceland is comparable, but still no less shocking. But it’s certainly not impossible to travel Iceland on a budget.

I spent 10 days exploring the Ring Road by campervan in July, which is the high of high season. A friend and I rented the most economical campervan we could find, which cost €100 per day (so €50 each). In order to get the cheapest price, our campervan had a manual transmission and it did not have a heater for sleeping at night. We saved €550 by renting a manual transmission campervan without heat, instead of an automatic transmission campervan with heat (for a 10 day rental). I was really nervous about not having heat because I do NOT do well in the cold, but it was totally manageable and we were thankful we didn’t pay extra for heat.

HOW TO TRAVEL ICELAND ON A BUDGET

ACCOMMODATION

YOU’LL HAVE TO CAMP OR COUCHSURF

I recommend camping because you can get away with planning A LOT less and it allows for more independence and spontaneity.

WHEN CAMPING, YOU ALSO MAKE ALL OR MOST OF YOUR OWN FOOD, WHICH SAVES A SIGNIFICANT AMOUNT OF MONEY

The average price for one meal, without a drink, at a restaurant is 2000-3000ISK+ (€15-22+).

IT’S MANDATORY TO CAMP IN A CAMPGROUND

Unless you have a tent (more on that below). With an increase of a few million tourists per year in Iceland, it’s now illegal to camp wherever you want.

WILD CAMPING IS ONLY ALLOWED WITH A TENT

Wild camping in Iceland is more of an exception than a rule. It is now illegal to spend the night in tent trailers, tent campers, campervans and cars outside of a campsite without a permission from the land owner. Wild camping in Iceland is allowed in some cases if you use a tent; however, there are A LOT of rules and restrictions.

CAMPGROUNDS COST 1500-2000ISK (€11-14)/NIGHT PER PERSON

But usually closer to the lower end of 1500ISK. The campgrounds in Iceland are quite civilized and clean and they have electricity, toilets, washing facilities, and most have showers. If you stay in a place without a shower, you can visit a public pool and use their shower for a small fee. There are a few free campgrounds in Iceland, but expect very basic facilities. See here for maps of campsites in Iceland, which includes the free campsites and year round campsites.

Campingcard Iceland includes camping at 40 different campsites all over the country for 28 days for a one time fee of €159.

Depending on your Iceland budget, in the low season you could probably get away with renting a car and staying in hotels and Airbnbs because prices would be lower than high season. But then you likely won’t have camping cooking supplies and therefore, will have to consider the massive additional cost of eating at restaurants for every meal.

GETTING AROUND

Public transportation in Iceland is quite limited and buses connecting different towns in Iceland will not bring you to the nature sights, so this is unfortunately not an option.

Hitchhiking in Iceland is possible, but it can be difficult because there is little traffic and you could get stuck in the middle of nowhere for hours. Then add the unpredictable weather, rain and high winds. You’ll need a lot of patience, time and warm and rainproof clothes.

Traveling with a friend (or two) will cut your transportation and gas costs in half which are massive savings for traveling Iceland on a budget.

The majority of rental vehicles are manual transmission, so renting a vehicle with a manual transmission is exponentially cheaper than renting an automatic vehicle. Europeans (and the majority of the rest of the world outside of the US and Canada) predominantly drive vehicles with manual transmissions, so car rental companies only have a few cars for North Americans who don’t know how to drive manual; therefore, the price to rent an automatic vehicle is significantly more expensive. If you don’t know how to drive manual, try learning before you go to Iceland. It’s an extremely useful life skill.

CAMPING AND TRANSPORTATION OPTIONS

Priced low to high

*Prices reflect high season prices. If you visit outside of high season, prices will be lower*

***You’ll need to figure out if your Iceland itinerary requires you to have a 4×4 vehicle to drive on the F roads or not***

HITCHHIKE AND TENT

This is the most hardcore and extreme way to travel Iceland on a budget. Hitchhiking in Iceland is difficult because there is little traffic and you could get stuck in the middle of nowhere for hours. Then add the unpredictable weather, rain and high winds. You’ll need a lot of patience, time and warm and rainproof clothes.

RENT A BASIC, COMPACT CAR – starts at €55 per day

Sleep in your car
Sleep in a tent
Splurge and sleep in a hotel or Airbnb

RENT A NON-4×4 CAMPERVAN

Manual transmission, no night heater, sleeps 2 – €100 per day
Automatic transmission, night heater, sleeps 2 – €150 per day
Large campervan, sleeps 3-5 people – These are typically the fancier campervans with more bells and whistles, like a fridge and running water. The majority of these campervans have heat. The fancier campervans will overlap in price with the 4×4 vehicles at €170-230 per day.

4×4 VEHICLE + SLEEP IN TENT – €100 per day

4×4 VEHICLE WITH ROOF TENT – €130+ per day

4×4 CAMPERVAN – €160-300+ per day for 2-4 people.

CAMPERVAN RENTALS

Go Campers has the cheapest campervans deal. My friend and I rented a manual transmission campervan, without a night heater, in the summer for €100 per day. It was NOT a 4×4 vehicle, so we did not drive on the F roads.

Other campervan rental companies are Happy Campers and KuKu Campers.

You’ll need to book a vehicle in advance in the summer months and you can add on extras, like wi-fi and GPS, to your campervan rental.

See Everything You Need to Know About Camping and Driving in Iceland

SIGHTSEEING AND EXISTING IN ICELAND ON A BUDGET

CONSIDER VISITING OUTSIDE OF HIGH SEASON

The weather may not be as “warm” or ideal, but the savings could be significant for traveling Iceland on a budget.

UNLESS YOU’RE VISITING THE FANCY, EXPENSIVE HOT SPRINGS LIKE THE BLUE LAGOON AND MYVATN, ALL THE SIGHTS IN ICELAND ARE FREE!

I only paid for Kerið, which was 400ISK cash (€3).

BUT PARKING ISN’T ALWAYS FREE

When you do have to pay, on average, it costs around 700ISK (€5).

MOST PUBLIC TOILETS ARE NOT FREE

They’re often 200ISK (€1.50), which is quite steep. But many gas stations have free toilets.

BRING SOME FOOD AND SNACKS FROM HOME

I brought 8lbs/3.6kg and €70 worth of snacks from home. I’m not saying you need to bring this much, but I wasn’t unhappy that I did because Iceland is extremely expensive. I brought a lot of nuts, snack bars, peanut butter, beef jerky and some instant oatmeal.

THE COLD TAPER WATER IS THE BEST IN THE WORLD AND IT’S FREE!

It’s completely pure and so cold and fresh. So pack a water bottle or two and fill up!

SORRY, THERE AREN’T ANY MCDONALD’S IN ICELAND

There are a few KFC and Domino’s in and around Reykjavik.

THERE IS A COSTCO IN REYKJAVIK!

This was the greatest news because Costco is known for cheap food. Some items were comparable prices to home (Canada), but many things were double the price. However, the prepared fast food area has the cheapest food you’ll find in Iceland, with pizza, hot dogs, sandwiches and ice cream etc. However, you do need a membership to shop at Costco.

OUTSIDE OF REYKJAVIK, BONUS IS THE CHEAPEST GROCERY STORE IN ICELAND

YOUR CAMPERVAN/RENTAL CAR COMPANY SHOULD HAVE A COMMUNAL LEFTOVER FOOD TABLE, WHICH YOU CAN SHAMELESSLY RAPE AND PILLAGE

Because that’s what it’s for, afterall. This came in quite handy as we got quite a lot of food from here like salt, pepper, oatmeal, coffee, snacks, pasta, etc. And when you’re done your trip, you can leave what you didn’t use for the next campers to rape and pillage.

DON’T SPEED SO IN ORDER TO AVOID AN EXPENSIVE SPEEDING TICKET

Speed cameras are a thing and speeding tickets in Iceland can cost hundreds of Euros. It’s not worth it.

SKIP THE BLUE LAGOON

Seriously. It’s a beautiful place, but don’t believe the serene pictures you see on Instagram and you’ll also save €70-85 during peak times. Who wants to sit in a human soup with hundreds of people taking pictures for Instagram at that price? (See here and here) However, if seeing the Blue Lagoon is a must on your Iceland trip, then you should go, but be aware of how crowded and overpriced it will be. Visit during the less popular times, like 7am and 11pm, which are also cheaper. Yes, you have to book what time you visit because it’s THAT busy. Also know that Iceland is full of hot springs, many of which are even free (see below). Or consider saving the Blue Lagoon for the end of your trip if you still really want to go by the end.

HOT POT ICELAND IS AN APP AND WEBSITE WITH A MAP OF ALL THE “HOT POTS” (HOT SPRINGS) ALL OVER ICELAND, AND MOST OF THEM ARE FREE!

It also shows where the gas stations are, which is also useful.