Iceland is known for its incredible landscapes, dramatic waterfalls, and unique geothermal activity, but it’s also infamous for being one of the most expensive travel destinations.
However, that doesn’t mean you have to break the bank to experience its magic! If you’re looking for affordable ways to explore the Land of Fire and Ice, here are ten budget-friendly activities to do in Iceland.
At Build a Break, we're all about exploring bucket list destinations for less, and sharing money saving tips with our readers.
Yes, Iceland is very expensive, but that doesn't mean you can't explore everything it has to offer- you just need to be clever about it and plan in advance.
We'll take you through our top 10 tips for exploring Iceland on a Budget.
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Seeing the Northern Lights is a bucket-list experience, and the best part? It’s completely free! The key is to visit between September and April when the nights are longest. Get away from city lights for the best view- popular spots near Reykjavik include Grótta Lighthouse or Thingvellir National Park. Check the aurora forecast and hope for clear skies!
We have written a guide for our top tips on spotting northern lights in Finland, and many of our tips for the best apps to use and guidance are the same for Iceland. You can read our guide here
Iceland’s public transport is limited, and taxis are notoriously expensive. Even the bus from the airport costs around £40 return per person.
Instead, renting a car gives you the freedom to explore at your own pace while saving money on tours such a northern lights or Golden Circle excursions.
Car hire starts around £50 for a 2 day hire- Search here
The Blue Lagoon and Sky Lagoon are stunning, but at €70+ per person, it’s not budget-friendly.
Thankfully, Iceland has plenty of cheaper geothermal pools! Try a more affordable experience like Laugardalslaug in Reykjavik, which costs under €10 and still offers warm, mineral-rich waters.
For an even more budget-friendly soak, check out hot springs in nature, like Reykjadalur’s hot river- completely free!
Iceland is home to countless waterfalls, and many of the most famous ones are free to visit. Seljalandsfoss and Skógafoss are along the south coast and easily accessible.
For a hidden gem, check out Kvernufoss, a stunning waterfall with far fewer tourists. If you’re exploring the north, don’t miss Goðafoss, known as the “Waterfall of the Gods.”
Hiking in Iceland doesn’t cost a thing, and the views are priceless! Glymur Waterfall is a fantastic hike with breathtaking scenery, and Mount Esja near Reykjavik is perfect for a day hike.
If you’re heading to Landmannalaugar, you’ll find some of Iceland’s most colourful landscapes- just remember to check road conditions if travelling in winter.
Reykjavik is a compact and walkable city, so you don’t need to spend on transport. Stroll along the colourful streets, visit the famous Hallgrímskirkja Church (you can admire it for free, but there’s a small fee to go up the tower), and check out Harpa Concert Hall with its striking glass architecture.
Don’t miss the Sun Voyager sculpture for a perfect photo spot!
Puffins, seals, and even whales can be spotted in Iceland without expensive tours!
Visit the harbour in Reykjavik for a chance to see seals or head to Dyrhólaey (May to August) for a great puffin-watching spot.
If you’re lucky, you might even see whales from the shore at places like Hvalfjörður.
Reykjavik has several museums that offer free entry on specific days. For example, the National Museum of Iceland sometimes has free admission days, and the Reykjavik Art Museum occasionally offers free entry.
Always check the museum websites before your trip to plan around their free or discount days!
Black sand beaches are one of Iceland’s most unique attractions and visiting them costs nothing. Reynisfjara Beach near Vik is the most famous, with its striking basalt columns.
For a quieter experience, check out Diamond Beach, where glistening ice chunks wash up onto the shore, creating a magical scene.
Eating out in Iceland is expensive, with even a simple meal costing €20 or more. Instead, save money by shopping at budget supermarkets like Bonus or Kronan. Many accommodations have kitchen facilities, so you can cook simple meals instead of dining out.
If you do want to try Icelandic food on a budget, grab a famous hot dog from Bæjarins Beztu Pylsur- it’s one of the cheapest meals in Reykjavik!
For deals that include flights, hotel, luggage and a northern lights tour, Jet2 have departures from many UK airports that start from £600! click here to search
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