How to Save Money in Reykjavik, Iceland
Iceland’s capital requires some capital. Ranking high on many “most expensive cities in Europe” lists, Reykjavík is not cheap.
As with any Icelandic destination, it is oh-so-easy to be lured in with a flight that may be comparatively affordable to other continental destinations. However, once your boots are on the ground, this volcanically morphed peninsula of a city can feel like a totally unplanned spending spree.
Many factors contribute to this, including the need to import goods to the island nation, plus high taxes and high average wages for the population of 200,000-plus living throughout the Greater Reykjavík region.
Consequently, there are ways to save money in Reykjavik. Everyday transactions are where you’ll see the most opportunities, including transportation, food, and passes for the biggest attractions. Here are some tips to help you enjoy the city’s bayside landscape and the friendly locals living within it.
For Better Deals, Steer Clear of the Summer Months
June through August are pure bliss in Reykjavík and beyond. Temperatures are the warmest all year (with highs in the mid-50s°F), and the “midnight sun” radiates for 20-plus hours a day. This is when folks flock to the city, so things tend to be more expensive. January through May is the timeframe for discounted flights and lodging.
Reserve Your Hotel as Far in Advance as Possible
As much of a tourism hotspot as Reykjavík can be, it doesn’t have an endless supply of lodging options. Whether you’re considering a chain hotel like Icelandair and Fosshotel, a boutique option, or an Airbnb, make sure to reserve well in advance. Waiting until you get to Reykjavík won’t save you money, and you may not have any options at the last minute.
Fly to Reykjavík and Weigh Your Options
To reach Reykjavík from international destinations in North America and Europe, Icelandair remains the go-to airline. It is headquartered outside of the capital at Keflavík International Airport, offering hundreds of nonstop and connecting flights per week.
Furthermore, twenty-three other airlines operate out of the airport, including European budget carriers Play, EasyJet, and Wizz. Consequently, keep an eye on bargain fares from the discount carriers, but make sure to read the fine print for any in-flight or baggage up-charges.
Get to the City Center by Bus
Keflavík International Airport is located approximately 50km (31 miles) southwest of Reykjavík’s urban core. It can equate to a hefty taxi fee and take approximately 45 minutes, making the airport a great spot to get acquainted with the bus system, or Strætó.
The ride may take a little longer—typically around an hour and 10 minutes—but line 55 goes back and forth between the airport and city center, with one-way fares running approximately $15. Moreover, Strætó has more than 50 routes throughout the region, with buses often stopping every 15 minutes on weekdays and 30 minutes on weekends.
Pass on the Bottled Water
Often, travelers are advised, “don’t drink the tap water.” However, this is not one of those destinations. Reykjavík boasts some of the purest water of any city, generated from Iceland’s untouched springs. Therefore, save the $3 to $4 per bottle—it’s unnecessary here.
Walk Around the City or Take a Free Walking Tour
Reykjavík is incredibly walkable, allowing you to reach landmarks like the Hallgrímskirkja cathedral and museums in just a matter of minutes. Moreover, guided walking tours can help you get your bearings. Among the various free options, CityWalk is highly recommended. Just remember to tip your guide.
Opt for a Much Smaller Geothermal Experience
Approximately 50km (31 miles) southwest of central Reykjavík, the Blue Lagoon is quite popular. However, you don’t have to venture far to experience a geothermal spa. The Grottá Hot Pool is a more intimate option, located in the coastal town of Grottá, just 5km (3 miles) northwest of the city center.
Snag a Reykjavík City Card for Major Savings on Big Attractions
If you plan to visit pools, museums, and travel by bus, the Reykjavík City Card proves beneficial. With options for 24-, 48-, and 72-hour durations, the card provides free entry into all of the city’s swimming pools, free bus travel (excluding the airport route), and complimentary entry at select museums. The cost of a 24-hour pass is roughly $30.
Buy Your Booze Strategically
Iceland has one of the highest alcohol taxes in the world—upwards of 75% of the purchase price—so if you plan to enjoy a bottle of wine or Brennivín during your Reykjavík adventure, it’s advisable to stock up at the airport’s duty-free stores. Otherwise, watch for happy hours, typically from 4pm to 7pm, along the pub-filled Laugavegur street and surrounding areas.
Snag the “Best Hot Dog in Town” on the Fly
Street food is thriving in Reykjavík, with food halls like Hlemmur Mathöll and the Old Harbour’s Grandi Mathöll taking center stage.
Often made with Icelandic lamb, hot dogs present an affordable cultural experience. The unassuming Bæjarins Beztu Pylsur—translating to “the best hot dog in town”—remains a go-to option, with seven locations throughout the city. A hot dog and soda typically cost less than $6.
Shop the Kolaportið Marketplace
While expensive shopping options abound in the Kringlan mega mall and along Laugavegur, price-conscious keepsakes, handmade Icelandic goods, and local food can be found at the Kolaportið marketplace. It’s conveniently located across the street from Reykjavík Harbor and Reykjavík Art Museum’s Hafnarhús, open on weekends.
Daily Costs
- Hostel room: $45–50
- Basic room for two: $160–175
- Self-catering apartment (including Airbnb): $225–250
- Public transport ticket: $3.50
- Coffee: $4–6
- Sandwich: $10–15
- Dinner for two: $90–100
- Beer/pint at the bar: $7.50–10
