Krona is the local currency in Iceland
Cost of traveling in Iceland
The cost of traveling in Iceland can be high if you prefer to travel luxuriously but there are also other less expensive ways. It might come to you as a surprise but Iceland has its own unique currency; The Icelandic Krona.
Although Krona is the local currency in Iceland other currencies, such as US Dollars and Euros, are widely accepted. Most stores advertise and display their prices in Krona so when you pay with cash (dollars or euros) the store staff calculates the exchange rate at the register. Often times the currency rate is rounded up so you might end up paying more for the goods than if you use the local currency. It is therefore advised to exchange your currency for Krona upon arrival. All the Icelandic banks provide such a service.
You can find the currency rate and other monetary information at The Central Bank of Iceland
Credit carts are widely accepted
Almost all businesses accept credit cards, which includes taxis, so you really do not need to carry a lot of cash with you but when traveling to some remote parts of Iceland you might need to pay with cash.
Tips are not a common tradition in Iceland and should not be a factor in you planning for traveling cost in Iceland. It is, however, appreciated when one leaves a small token of gratitude before leaving the restaurant or the bar.
The cost of traveling in Iceland
Iceland is, by many people, considered an expensive country to travel to. This is of course relevant to your financial standing and your priorities. You can find both luxurious experiences and most budgetary options and everything in between. Do some research while planning and ask the locals once you have arrived.
In order to give you an idea of your traveling cost in Iceland, for your planning, we have made a table (see below) with the average cost of goods and services in Iceland. This is not by any means an exhaustive list but it might help you figure out how much you can expect to spend while visiting Iceland.
Tips on buying souvenirs in Iceland
Like so many popular tourist places Iceland is full of tourist traps. In Reykjavik, one can find countless souvenir stores with stuff made in the far east, like China. In between, you can certainly find some locally made products like wood carved birds, earthenware cups and saucers, and many more nice things.
One of the most popular products in these stores is Icelandic Woolen Sweaters. Be careful when you shop around because there is a lot of Chinese-made woolen sweaters around. These sweaters might be made from the famous Icelandic wool but the knitting quality of the knitting is not always the best. If you are looking for a traditional hand-knitted woolen sweater look for the sign from the Handknitting Association of Iceland. They have their own store where you can find top quality and sometimes the price is very reasonable. It can definitely lower traveling costs. If you are able to buy your sweater at the beginning of your journey, do so because you might need it on a cold day.
The Icelandic water
Cold Spring water
Iceland is rich in fresh cold spring water. You can drink it from the tub. There are no preservatives or additional chemicals like chlorine, calcium, and nitrate in the tub water. You can drink it. The fact of the matter is that the water is naturally and organically filtered through the ground. Save the plastic bottle and fill it with tap water anywhere in Iceland. This will save some on the cost of traveling in Iceland.
Hot tab water
The hot water in the faucets or the showers, in most places, is geothermal. Meaning they come from the deep earth. It is perfectly safe to wash or bathe in the water but it is not recommended to drink it. The reason is simple; it doesn’t taste good and in some places, it smells of sulfur. In spite of the smell, it is harmless to drink it just doesn’t taste good.
Most Icelandic houses are heated up with geothermal water. It is rather cheap so you might find Icelandic homes open up all the windows to cool the apartment rather than turn the heat down.
One popular aspect of geothermal water is the swimming pools. You should definitely aim to visit one. There are probably more swimming pools per capita in Iceland than anywhere else in the world.
Average prices of products and services in Iceland
| Product/Service | Pricer range ISK |
| Accommodation | kr. 12.000 – 40.000 |
| Dinner at restaurants | kr. 2.500 – 8.000 |
| Take out meals | kr. 1.200 – 4.000 |
| Coffee and Danish Pastry | kr. 900 – 1.200 |
| Breakfast at restaurants | kr. 800 – 2.000 |
| Local beer 1/2 liter at bars | kr. 700 – 1.400 |
| Soda at a bar | kr. 400 – 700 |
| Small Skyr | kr. 180 – 220 |
| Sandwich at grocery store | kr. 500 – 900 |
| 1 Liter milk at grocery store | kr. 175 – 220 |
| Bottle of water 1 Liter | kr. 190 – 240 |
| Loaf of bread at grocery store | kr. 320 – 500 |
| Bottle of wine, liqor store | kr. 1.800 – 3.000 |
| Eggs 12 pc box | kr. 500 – 800 |
| Rice 1 kg | kr. 200 – 550 |
| Potatoes 1 kg | kr. 180 – 400 |
| One way bus ticket, Local | kr. 450 |
| Taxi, average trip in the city | kr. 3.000 – 6.000 |
| Car rental, average car per day | kr. 4.200 – 8.500 |
| Gasoline 1 liter | kr. 180 – 220 |
| Art museum | kr. 1.500 |
| Domestic flight | kr. 9.000 -14.000 |
| Traditional Icelandic Woollen Sweater | kr. 20.000 – 40.000 |