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Iceland – Cost of Living

Iceland is a stunning island country located in the North Atlantic. It is known for its breathtaking landscapes, vibrant culture, and unique cuisine. Iceland has a reputation for being an expensive place to live, but there are still ways to enjoy this beautiful country without breaking the bank. In this article, we will explore the cost of living in Iceland, including currency, comparisons to the UK and USA, breakdown of costs, and common forms of payment.

Local Currency in Iceland

The local currency in Iceland is the Icelandic króna (ISK). One króna is divided into 100 aurar, but due to inflation, aurar are no longer in circulation. There are coins in denominations of 1, 5, 10, 50, and 100 krónur, and banknotes in denominations of 500, 1,000, 2,000, 5,000, and 10,000 krónur.

Cost of Living in Iceland Compared to the UK and USA

The cost of living in Iceland is generally higher than that of the UK and the USA. According to Numbeo, a website that compares cost of living in different countries, the cost of living index in Iceland is 107.79, while the UK is 69.08, and the USA is 76.86. This means that on average, it is more expensive to live in Iceland than in the UK or USA.

Breakdown of Costs in Iceland

The cost of living in Iceland can vary depending on the location and size of the household. Here is a breakdown of some of the typical costs for singles, couples, and families of four in Iceland:

Housing

Housing costs in Iceland can be expensive, especially in Reykjavik, the capital city. In Reykjavik, the average monthly rent for a one-bedroom apartment in the city center is around 200,000 ISK, while a three-bedroom apartment can cost around 500,000 ISK. Outside of Reykjavik, the cost of housing can be lower, but still expensive.


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Food

Food in Iceland can be expensive, especially if you are eating out. Eating out in Iceland can be very expensive, with a meal at a mid-range restaurant costing around 6,000 ISK per person. Grocery shopping can also be expensive, with a loaf of bread costing around 350 ISK and a liter of milk costing around 200 ISK.

Utilities

The cost of utilities in Iceland varies depending on the size of the household and the location. On average, electricity, water, and heating bills for a family of four in Reykjavik can add up to around 50,000 ISK per month. Internet and mobile phone plans are also reasonably priced, with a typical plan costing around 8,000-10,000 ISK per month.

Leisure

Iceland offers a variety of leisure activities, from visiting glaciers to exploring national parks and relaxing in geothermal pools. Many activities in Iceland can be expensive, such as visiting a spa or taking a glacier tour. Paid activities can cost between 5,000-20,000 ISK per person.

Transport

Public transportation in Iceland is limited, with most people relying on personal vehicles or taxis. Owning a car in Iceland can be expensive due to high taxes and gasoline prices. Taxis are also expensive, with a typical 10-kilometer ride costing around 4,500 ISK.

Clothing

The cost of clothing in Iceland varies depending on the brand and quality. Affordable clothing options can be found at popular stores such as H&M, Zara, and Mango, with t-shirts costing around 2,000 ISK and jeans around 10,000 ISK. High-end designer clothing can be more expensive, with a designer dress costing around 50,000 ISK or more.

Household Goods

Household goods such as furniture, appliances, and electronics can be expensive in Iceland, especially if purchased new. Second-hand goods can be purchased at a more reasonable price, with sites like Facebook Marketplace and Bland.is offering many options. A new refrigerator can cost around 80,000-100,000 ISK, and a new television can cost around 50,000-100,000 ISK.

Common Forms of Payment in Iceland

Debit and credit cards are widely accepted in Iceland, and it is recommended to use them instead of cash, especially for larger transactions. ATMs are widely available throughout the country, and credit and debit cards are accepted at most major retailers and restaurants. It is important to note that some smaller shops and restaurants may only accept cash, so it is always a good idea to have some Icelandic króna on hand.

In conclusion, Iceland is known for being an expensive country to live in, especially when it comes to housing and food costs. However, there are still ways to enjoy this stunning country without breaking the bank, such as exploring national parks and free activities. Public transportation is limited, but it is possible to get around with personal vehicles or taxis. Debit and credit cards are widely accepted in Iceland, but it is still recommended to carry cash for smaller transactions.


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