Iceland on a Budget: Cheap & Free Things to Do

|April 9, 2019
As part of my Event and Business Management degree, I decided to move to Iceland to join the marketing department at Arctic Adventures. I love exploring, photography and going on new adventures.

Iceland is a prosperous, peaceful and popular spot for visitors. A downside to all this good fortune is that it is not the cheapest country in the world to visit. But don’t let that put you off! Thousands of visitors come to Iceland every year, and many of them are doing so on a limited budget.

Much of Iceland’s abundant natural beauty can be experienced for free, and the country enjoys a European-style hostel culture. So, budget travellers have paved a path through Iceland over the years, pooling their resources, seeking out the best value and stretching those króna!

Here are some of the ways in which you can follow in their frugal footsteps…

Stay in Hostels

Iceland has a range of stunning, high-end hotels, but some of them might not be within a budget-travellers price range.

Instead, consider one of the country’s many hostels. These accommodations range from the quite rustic to the surprisingly comfortable and luxurious. These characterful spots tend to reflect their owners’ charming tastes and oddities – from 70s style décor to quirky uses of space.

Hostels also tend to have good spaces for cooking and eating your own meals, for those of you who want to avoid eating out and keep those costs down.

HI Iceland is a non-profit organisation with a chain of hostels located throughout Iceland. It’s worth your while registering as a member as there is a great value to be found here.

If you’d like to treat yourself to a hotel stay, Arctic Adventures has a range of accommodation at various points of the price scale.

Share the Cost

Whether you’re travelling alone or with a group, you might want to consider sharing some of the costs: A good example is car rental. Many of our tours are either self-driving or begin at a site that you get to yourself. And the financial difference between one person renting a jeep and four of you doing it is, as you might imagine, substantial.

Eat Casual

There are ways to enjoy Icelandic food without breaking the bank. Look into street food, casual food and hostels. Icelanders love their hot dogs, and if you’re in a city you’re never too far from one! Sandwiches are also quite plentiful, but not quite as cheap.

In fact, we recently published a guide to cheap eats in Reykjavik to help get you started.

Buy Alcohol the Smart Way

It’s true that bars in Iceland vary in price, from the affordable to the…less so. But there are ways to stretch that beer money. For a start, Icelandic off-licenses (AKA liquor stores) sell alcohol much cheaper than pubs and restaurants do. Even better: Buy the alcohol at the duty-free, either upon departure or arrival. (If possible, go for the latter – Icelandic beer is world class.)

BYO (or BYOB) restaurants are relatively rare in Iceland, and they don’t tend to advertise the fact. But locals and hostel staff can point you in the right direction.

Also, there are local apps available to tell you when drink offers, happy hours and limited-time opportunities are available (usually in Reykjavik).

Drink the Tap Water

Some cultures have embraced bottled water for their daily consumption, especially in Europe and North America. However, the tap water in Iceland is among the purest in the world (maybe the purest), so there is no need to worry about impurities or anything else that you might not like to find in your drinking water! Because of this, everyone drinks the tap water in Iceland. You can buy a reusable bottle and stock up on tap water before every trip.

Hit the Flea Market

It can be a good idea to check out the Flea Market in Reykjavik called Kolaportid These are where you can pick up bargains, often ones that you won’t find anywhere else. How does cute souvenir sound? Or maybe a tasty street food snack? A flea market is the best place to pick up these kinds of things at low prices.

Don’t Forget to Camp

Iceland has a wonderful camping culture, and if you do it right, it can slash accommodation costs.

This is something to consider even if you’ve never camped before: Icelandic campsites are among the best you will ever encounter, and many of them have excellent facilities (bathrooms, showers, kitchens and sometimes even stores). Thanks to some glorious nature (possibly the reason you’re considering visiting in the first place), camping is hugely popular among locals and visitors alike. As luck would have it, we recently wrote a comprehensive guide to camping in Iceland!

Seeing the Sights without Breaking the Bank

The beautiful thing about Iceland is that much of it is free to enjoy: Its pure water, stunning scenery, rejuvenating springs and stunning views are available to all.

The other stuff – food and accommodation – isn’t free, but as you can see, with a little planning and the right attitude, Iceland is absolutely within reach for those on a strict budget.

In fact, a trip to Iceland is an investment, as the memories will stay with you for the rest of your life.

Related Tours

Related Blogs