When I planned my solo budget travel to Iceland, i admit—I was a little intimidated by the costs.
I’d heard countless stories about $50 basic meals, and I thought Iceland might be out of reach for budget travelers.
But I was so determined to see the glaciers, waterfalls, and maybe even catch the Northern Lights, that I decided
to dive in and figure out the most affordable way to do it.
And you know what?
With some planning, it ended up being one of the best—and most surprisingly affordable—trips I’ve ever taken.
From staying at budget hostels and using couchsurfing to stay for free to cooking your own meals and focusing on Iceland’s free natural wonders, there are ways to make this trip work.
Iceland’s highlights—the majestic waterfalls, volcanic beaches, and glacier lagoons—are there to explore without expensive tour fees.
In this 7-day budget itinerary, you’ll find practical tips for how to make the most of every dollar, ensuring you can enjoy your budget trip without emptying your wallet.
Essential Tips for Budget budget travel in Iceland
1. Affordable Accommodation Options
Finding affordable accommodation in Iceland is one of the best ways to keep your trip budget-friendly. During my own trip, I found a mix of hostels and couchsurfing that helped me stay comfortable without breaking the bank. Here are some of the best options:
- Hostels: Hostels are a fantastic option, especially in Reykjavik and the larger towns. They’re budget-friendly and often have shared kitchens, so you can cook your meals. I stayed at kex Hostel in Reykjavik, which was clean, cozy, and a great place to meet other travelers.
- Guesthouses: If you want a bit more privacy than a hostel but don’t want the expense of a hotel, guesthouses are a good compromise. They’re often run by locals, so you can get personal insights and recommendations.
- Couchsurfing: I also tried couchsurfing, which not only gave me a free place to stay but connected me with some incredible Icelanders who shared insider tips on exploring on a budget.
2. Book in Advance and Avoid High-Season Prices
On my Budget Travel in iceland, one of my biggest mistakes was that I went there in August.
it has its own sharm in summer and is easy to get around, but everything was really expensive from renting a car to findinga cheap hostel .
Here’s what I learned:
- Shoulder Seasons (April-May, September-October): These months offer better prices on flights, accommodations, and even car rentals. Plus, there are fewer tourists, so you won’t deal with the crowds.
- Winter Travel: Winter in Iceland has its own charm—think snowy landscapes and the Northern Lights. Just know that driving can be tricky with icy roads, so take it slow if you’re renting a car.
- Lock in Deals Early: Booking accommodations and car rentals a few months in advance lets you grab the best prices. I found that prices doubled if I waited until the last minute, especially for accommodations.
3. Transportation Tips for Budget Travel in iceland
One thing to remember about Iceland is that public transport is limited outside of Reykjavik, so getting around can be costly without the right strategy. Here’s a breakdown of your best options:
- Renting a Car: Renting a car can actually be more budget-friendly than relying on tours, especially if you split the cost with other travelers. Iceland’s Ring Road offers endless scenery, so driving is half the adventure!
- • Budget-Friendly Car Rental Agencies: Look into agencies like SADcars or Go Car Rental Iceland, which specialize in affordable rentals.
- Cost of Renting:
Summer: In summer, rentals can range from $80–$120 USD per day,
Winter: but winter rates are often much lower, sometimes as low as $30–$50 per day. Winter driving takes caution, though, so check the weather and road conditions before heading out
• My experience: I rented a car with two other travelers I met at my hostel, and we split the costs. It was honestly one of the best parts of the trip, as we could stop anytime to snap photos or explore a waterfall.
Hitchhiking
Hitchhiking is more common in Iceland than I expected, and it’s safe and free!
When I arrived at Keflavík Airport, I was shocked to find the bus to Reykjavík center cost $22. Instead of paying, I decided to try hitchhiking—it took just 10 minutes to get a ride, and a friendly local dropped me right in the city center for free.
So if you have some time and a spirit for adventure, this can be a great way to save on transportation.
Carpooling & Rideshare Options:
Sites like Samferda.is help connect drivers with passengers heading in the same direction, letting you split costs with locals or other travelers. It’s a good alternative to traditional rentals.
4. Saving on Food and Dining
Dining out can really eat into your budget
So one of the easiest ways to save money is by shopping at local grocery stores and cooking your meals:
- Grocery Stores: Stores like Bonus and Krónan have affordable groceries where you can pick up basics like bread, cheese, yogurt, and snacks. Skyr, Icelandic yogurt, was my go-to breakfast—it’s filling, cheap, and delicious.
- Cooking in Hostels or Guesthouses: Most hostels and guesthouses have kitchens. I would often make a simple pasta or sandwich dinner at the hostel
- Packing Snacks: If you’re exploring the countryside, there won’t always be food stops, so having snacks on hand is essential.
5. Money-Saving Apps and Travel Tools
To help manage your budget and keep track of expenses, I relied on a few apps and tools that made a big difference:
• Samferda.is: This is Iceland’s ridesharing platform. It helped me connect with local drivers going my way, which saved me money on intercity transportation.
XE Currency: This app helps track exchange rates so you know exactly what you’re spending in Icelandic Krona.
Google Maps Offline: I downloaded maps for all the areas I planned to drive in advance, as Iceland has some remote regions with spotty service. It saved me on data costs and helped me navigate confidently.
Couchsurfing: Great for free accommodation and connecting with locals who can offer advice on hidden spots.
7-Day Budget-Friendly Iceland Itinerary
This itinerary will take you through Iceland’s iconic sights, with a daily breakdown of what to see and do on a budget.
Make in consideration on this itinerary you have two choices for accommodations
- stay in reykjavik all nights and each day explore new destinations .this choice might be good if you want to save money because accommodation outside reykajvik will cost you at least 70$ for hostels and you might not found sometimes but will be tiring
- stop in each destination and take hostels or guesthouse, do camping or use couchsurfing if you found a host which is the best choice to save time so if you are going with group trip or you do camping the second choice is the best
Day 1: Arrival in Reykjavik – Exploring the Capital on a Budget
Arrival at Keflavik Airport: Once you’ve arrived and picked up any rental car (or gotten bus tickets if you’re going car-free),
head toward Reykjavik, about 45 minutes away.
Hallgrimskirkja Church: Start with the famous Hallgrimskirkja, admiring the architecture and city views.
Reykjavik Waterfront and Sun Voyager:
Walk down to the waterfront, where you’ll find the Sun Voyager sculpture. Spend 15 minutes here enjoying the view and taking photos.
Harpa Concert Hall:
Just a short walk from the Sun Voyager, you’ll find the Harpa Concert Hall. Even if you don’t attend a performance, you can still explore its striking glass design for free.
Walk along Laugavegur Street:
Reykjavik’s main street is lively with shops, street art, and local cafes. Window shop, grab a snack, or just enjoy the atmosphere.
Walking around Lake Tjörnin Austurvöllur Square
• Dinner: Many budget travelers grab something from Bonus supermarket and make their own dinner if their hostel has a kitchen.
Day 2: The Golden Circle – Iceland’s Must-See Route
Thingvellir National Park:
Drive about 50 minutes from Reykjavik to start your day at Thingvellir National Park. Walk the trail between the tectonic plates and spend about 1.5–2 hours exploring this UNESCO World Heritage Site.
Geysir Geothermal Area:
From Thingvellir, drive 45 minutes to reach the Geysir geothermal area. Watch the Strokkur geyser erupt every few minutes and explore the surrounding hot springs—no entrance fee required.
Tip: Bring a Packed Lunch: Pack sandwiches or snacks bought from a supermarket in Reykjavik. Many travelers enjoy their packed meals at the picnic areas near Geysir.
Gullfoss Waterfall:
Just a short 10-minute drive from Geysir,Gullfoss is a stunning two-tiered waterfall that is free to visit. Spend about 30 minutes here to take in the views and walk the nearby trails.
Kerid Crater :
If you have time, Kerid Crater is about 45 minutes south of Gullfoss. and you can walk around or descend into the crater.
Day 3: South Coast Adventure – Waterfalls, Black Sand Beaches, and More
Seljalandsfoss Waterfall:
Head out early for the hour-long drive to Seljalandsfoss. This waterfall is famous because you can walk behind it, so expect to get a little wet. Spend 30 minutes here, and consider exploring the nearby Gljufrabui waterfall.
Skogafoss Waterfall:
About 30 minutes from Seljalandsfoss, Skogafoss is one of Iceland’s largest and most beautiful waterfalls. If you’re up for it, climb the stairs alongside it for views from above.
Reynisfjara Black Sand Beach:
Drive about 30 minutes from Skogafoss to Reynisfjara. This beach is known for its black sands and basalt columns. Spend about 45 minutes here and avoid getting too close to the water due to strong waves.
Day 4: Vatnajokull National Park and Jokulsarlon Glacier Lagoon
Drive to Vatnajokull National Park:
Head out early for the 2-hour drive to Vatnajokull National Park. You’ll want plenty of time to explore the hiking trails and viewpoints. Spend about 2 hours hiking and taking in the views.
Skaftafell Area Trails:
Hike to the Skaftafell waterfall (Svartifoss) if you’re up for it—it’s around a 1-hour round-trip hike.
Jokulsarlon Glacier Lagoon and Diamond Beach:
From Vatnajokull, drive about 45 minutes to Jokulsarlon. Here, you’ll see chunks of ice floating in the lagoon, and you can walk over to Diamond Beach for a stunning view of icebergs on black sand. Spend about an hour here.
Day 5: East Fjords – Road Trip through Iceland’s Scenic East Coast
Drive through the East Fjords:
Start your drive along Iceland’s scenic east coast. The views are stunning, so plan to stop along the way to take photos and enjoy the landscape.
Visit Seydisfjordur:
This colorful town is one of Iceland’s gems, known for its quaint buildings and picturesque setting. Walk around town, visit the famous blue church, and browse the local shops.
Stay Overnight in East Fjords Towns:
Find budget accommodations in Egilsstadir or another nearby town for a cozy night in the east.
Day 6: North Iceland – Akureyri and Surrounding Attractions
• Drive to Akureyri: Set out early for Akureyri, Iceland’s “Capital of the North.” Start your day by exploring the Akureyri Botanical Gardens, free to visit, and take in the local flora.
• Godafoss Waterfall: About a 30-minute drive from Akureyri, Godafoss is one of Iceland’s most beautiful waterfalls.
• Myvatn Nature Baths: End the day at Myvatn Nature Baths, a cheaper alternative to the Blue Lagoon. Entrance is around $40 USD, but it’s a soothing experience.
• Stay in Akureyri or Nearby: Accommodations in Akureyri are more budget-friendly than those in Reykjavik, and there are plenty of hostels and guesthouses to choose from.
Day 7: Return to Reykjavik and Final Day in Iceland
• Drive Back to Reykjavik: On the way back, stop at any scenic spots you may have missed on your way up north.
• Final Sightseeing in Reykjavik: If you missed anything in Reykjavik on the first day, now is your chance to catch up. Spend some time exploring local markets like Kolaportid Flea Market for souvenirs.
• Prepare for Departure: Pack up and head to Keflavik Airport for your flight home, taking with you memories of Iceland’s incredible landscapes and unique culture.