This post is also available in: German

Icelandair gives people seven days of free layover time in Iceland and this is just about the perfect amount of days you need to cruise all around the ring road and see most of it.

The ring road is a 1332 km long loop that runs around the island and connects most of the attractions as well as many of the remote settlements. And honestly, is there a better country for a road trip than Iceland with its rugged nature? My seven day trip around the island left me constantly wondering “is this real?” and honestly, I stopped so often to snap photos and simply marvel at things, that I had trouble getting to places in a somewhat timely manner.

While it’s totally possible to hitchhike around Iceland and some crazy people even bike the whole thing (seriously, mad respect to you guys), the public transportation system is pretty terrible and the best way to see the island is still in your own rental car.

Here’s all you need to know about driving around Iceland on an epic budget road trip:

Don’t get stuck in Reykjavik and explore the countryside instead

Reykjavik is a great city and you should definitely explore it for a few hours if you have the time, but, you also didn’t come to Iceland to see cities, am I right? It’s hard to find a country more stunning than Iceland, where impressive waterfalls are simply in people’s backyards, mythical lava fields dot the landscapes and just about everything is worthy of a full page spread in Nat Geo. Don’t get stuck in the city and head out into nature!

A landscape somewhere on the Snaefellsnes Peninsula.

There is more to Iceland than just the Golden Circle

Obviously, many people don’t have much time and therefore opt to visit the attractions closest to Reykjavik. Namely those are the Geysir (not active any more) and Strokkur (erupting every 5mins or so), Gullfoss and Þingvellir National Park and accordingly, those can get very busy. Contrary to many other locations in Iceland, it’s on this Golden Circle that the tour busses and sometimes loud and obnoxious tour groups come and go constantly. Due to there being a lot more people but also less impressive nature, I was a bit underwhelmed and I’m telling you that there are so many other seriously awesome places to see.

Don’t get me wrong, the Golden Circle is nice too, but if you have a few more days available, get out of there as fast as you can. Explore the Snaefellsnes Peninsula, go to Lake Myvatn, drive down some back roads and find beautiful hidden waterfalls or drop in at one of the charming seaside towns.

Seaside town in Iceland

Pick the car that is right for you and your adventure

Don’t make the same mistake we did and get a vehicle without checking whether it’s good on gas or not. Our Toyota RAV4 was really awesome to look at, had tons of room and was overall a great car for the trip we picked, but had a tiny tank and burned a bit more fuel than I was comfortable with. Ok, the tiny tank was not the poor car’s fault and was mainly a psychological issue on my part, but this meant that sometimes we had to fill up the car 2-3 times a day and thanks to the insane cost of fuel in Iceland, each stop at the gas station gave me a couple new grey hairs.

Pick a car that is fuel efficient, maybe even a diesel car and make sure to fill it up every time you go past the halfway mark. Gas stations in rural areas are few and far between and you don’t want to get stuck in the middle of nowhere in some national park with an empty tank.

Our Toyota RAV4 in a moss field

A great rental company is SADcars, whose cars, contrary to what the name suggests, are anything but sad. While most rental companies rent out brand new cars and are accordingly very, very pricey, SADcars uses older vehicles and is simply unbeatable in the deals they offer. Seriously, these competitive prices start at $33 per day and you won’t find anything cheaper in Iceland.

Their cars might be a bit more mature, but you’re barely able to tell when you look at them. They are incredibly well maintained and everything from minis to big 4x4s suitable for highland roads are available. The SADcar location is out by the Keflavik Airport, which is perfect because they pick you up with a shuttle bus and there are no long lines. Within minutes, you will be in your car and off to your adventure. Plus, if you pre-pay when you make the booking, you get an additional 15% off the price. Can’t beat that!

Hotdogs all the way: eat cheap at gas stations

With regular, basic meals costing anything upward from $30, for most budget travellers, eating at restaurants just isn’t an option. It’s a good thing though, that Iceland has the greatest gas stations in the world. Now don’t judge me too hard, but I was able to eat there every day for a week and still have a pretty balanced diet and not get scurvy. Gas stations always offer the famous and honestly delicious Icelandic hotdogs topped with fresh or fried onions, as well as a selection of gourmet sandwiches filled with salmon, sweet potato, avocado and all that good stuff. Hotdogs usually cost around $2-3, while the sandwiches are a bit more expensive at around $6-7, but at the gas stations there are also often small burger joints where you can get a decent meal for under $10.

When it comes to grocery stores, Bonus, Kronan and Netto are probably the best known budget stores in Iceland. It’s easy to pick up a few groceries and cook a cheap meal in the campground or hostel kitchen.

Bæjarins Beztu Pylsur has the best hotdogs in all of Reykjavik.


Apart from gas and food, accommodation is the third thing that is insanely expensive in Iceland. Looking at hotel and guest house prices almost gave me a heart attack and the decision was made pretty quickly, that we would go on a camping adventure instead.

And let’s be honest, is there a better place to sleep than right in front of a waterfall with a view of the thundering water tumbling down amidst green slopes? Many of Iceland’s campgrounds are in absolutely stunning locations, have steaming hot water showers, toilets and sometimes even kitchens and good wifi.

One of my favourite camp grounds was the one right in front of Skogafoss, one of the biggest waterfalls in the country. I thought I had died and gone to camping heaven. So the locations aren’t only scenic, but most of them are completely free. If you don’t mind not having the usual facilities for a day, you can simply wild camp anywhere that isn’t private property and plop your tent down right there.

Campground right in front of Skogafoss.

If you do prefer a proper campground though, you can get the Camping Card, which costs only 14900 Krona (about $123) and allows two adults and up to four children to camp for up to 28 nights on 44 camp grounds around the country. It’s a great way to save money if you plan on spending a lot of time camping, as individual nights at campgrounds usually cost around $10 per person.

For those of us who don’t feel like dragging all our camping equipment to Iceland, there are a lot of companies that offer camping equipment rentals for pretty decent prices. Just order online and pick up what you need in Reykjavik – it’s too easy and worked really well in our case.

If the weather is absolutely dreadful and you don’t feel like setting up a tent in the pouring rain, you can always drop in at one of the many hostels. They are usually around $35-40 for a dorm bed if you bring along your own sleeping bag (pillows are provided).

Beware of the crazy weather: when is the best time to visit Iceland?

Iceland is a bit tricky when it comes to weather and there is simply no guarantee that during your chosen time the sun will be shining and the elfs chirping. The best month to visit is June, as the school holidays in Europe haven’t started yet and thus, there are far fewer people driving around than during the busy summer months. In June, the weather is also the driest and sunniest and your chances of getting rained on are pretty low. July and August are obviously the busiest months and things can get a bit crowded, but the weather is nice and warm-ish and you will definitely get the most hours of daylight. Keep in mind that Iceland is very expensive and during the high season in July and August, everything costs double.

Personally, we chose September because it’s the low season and there are very few people visiting during this time of the year, but it still isn’t too cold to camp. It was chilly at times and we needed the jacket, long underwear, scarf and all those things, but we also got a couple of sunny days and only really got poured on for one day. The year before though, so we heard from an old camp ground owner, Iceland got a foot of snow at the same time of the year.

It's pretty out there - the Icelandic countryside and a farm.

In the end, I guess it’s like anywhere in the world and there is quite some luck and praying to the weather gods involved.

What can be guaranteed though are the extremely fast weather changes and constant heavy winds. One minute the sun is shining, the next you hit a wall of icy fog and ten minutes later it is pouring. The weather in Iceland is simply insane and there is no way to know ahead of time what it will be like. So it’s best to just be prepared for any situation and bring the rain coat along just in case. Another thing you will have to learn to deal with are the constant gale force winds. High winds are responsible for most accidents in Iceland and wind damage to cars is a big concern for rental companies. Many tourists have had their car doors ripped out of their hands and completely bent out of shape by the strong gusts because they parked the car the wrong way. So keep your hands on the steering wheel at all times, always park according to the wind direction and never leave a car door open.

Stormfront rolling in over a herd of Icelandic horses.

11 Responses

  1. Clive Hislop

    Really appreciate your posts on Iceland and how to do it on the cheap! My wife and I are planning to make the trip next year, and you’ve already saved us lots of £/€/$

  2. Sam Stapleton

    I’ve been wanting to visit Iceland for a long time but it looks to still be a couple of years away. I’m hanging on to your article though because it’s the best darn primer on Iceland that I’ve encountered. Thanks so much for sharing this.

    • Tiffany

      Thanks so much for your comment Sam 🙂 I’m very glad I could help. Message me if you ever need more travel tips and have a great future Iceland trip!

  3. Jim Martin

    Great article, Tiffany. My particular sadcar died halfway around the ring road. They were helpful getting it replaced, but unfortunately it cost half a day…good price, though. 🙂

    • Tiffany

      Oh no that’s too bad, it’s always such a pain if the car breaks down or you get a flat tire! But I’m glad you got fast customer service 🙂 hope you had a great time in Iceland!


Leave a Reply

Your email address will not be published.

CommentLuv badge