It’s hardly news to say that the Land of Fire and Ice is a stunning place to live, full of natural wonders with affordable education and healthcare.
That being said, Iceland is notoriously expensive and has one of the highest costs of living in Europe. So, while you can be surrounded by geysers, hot springs, and the Aurora Borealis, this natural wonderland definitely comes at a premium.
So, with that in mind, let’s dive into the pros and cons of living in Iceland!
A Quick Overview & Comparison
|Pros of Living in Iceland||Cons of Living in Iceland|
|Gorgeous natural beauty||Cost of living|
|Hot springs||Availability of items|
|Education level||Icelandic attitudes toward expats|
|Equal pay||Winter Weather|
|Health care||Travel options|
The Pros of Living in Iceland
1. Gorgeous Natural Beauty
From the Aurora Borealis, or Northern Lights, to the black sand beaches of Vik, to the Golden Circle waterfalls and geysers, there’s no getting away from the fact that Iceland is jam-packed full of natural beauty and wonders.
Whether you love wandering around on windswept beaches, surfing the icy coastline, scuba diving between tectonic plates, cycling through the rugged countryside, or being surrounded by rushing waterfalls, and even spotting whales, Iceland is the place for you. Let’s be honest, the natural wonders of Iceland are what’s put Iceland on the map for so many tourists.
2. Hot Springs
Being an island that’s just bursting with geothermal energy, Icelanders have made the most of this abundance of energy by keeping their energy sources pretty green and reliable, however, there is another popular use of this geothermal goldmine.
There are warming, soothing, and picturesque hot springs all around Iceland. The most famous ones are definitely the Blue Lagoon and the Secret Lagoon which are both tourist favorites, but there are over 45 different hot springs around the island to choose from.
With some of the highest investment in education and the highest literacy rates in Europe, Iceland doesn’t mess around when it comes to education. In fact, around 35% of people in Iceland have completed tertiary education which includes university, college, or trade-based vocational courses.
As universities and colleges in Iceland are free, except for a small registration fee, there are minimal financial barriers to higher education, meaning that more people attend and complete university in Iceland each year.
4. Equal Pay
Unlike many countries, Iceland announced in 2018 that businesses with over 25 people have to show proof that they pair both men and women fairly and keep the pay scale equal. This was a huge step forward for gender equality in the workplace and helped to keep the gender pay gap in check.
As a result, many Icelandic businesses and corporations are really transparent about pay scales and what different roles entail. Considering how taboo talking about pay is in a lot of countries, this is really refreshing, and has a huge positive impact on Icelandic society!
There might not be a ton of different towns and cities in Iceland, but within each one, walkability is key. With many areas of Reykjavik being completely pedestrianized and there nearly always being a super wide pavement, it’s an ideal place if you want to walk from place to place.
Even if you’re in the capital, Reykjavik, it never seems like it takes too long to walk to any place within the city center. As the towns and cities are relatively compact, there’s a big emphasis on walking over driving which also keeps everyone as healthy as possible!
While healthcare in Iceland isn’t entirely free, the state healthcare system does heavily subsidize the cost to keep payments low. This works through a capped system. There is a maximum amount you can pay each month for healthcare and any other treatment over that amount is free. In fact, if you’re a child, over 67, or disabled, your monthly cap is automatically lower.
It’s worth noting that you’ll only have access to the socialized healthcare system in Iceland after you’ve lived there as a resident for six months. So, up until that point, you might want to invest in some private health insurance to cover the shortfall.
The Cons of Living in Iceland
1. Cost of living
Okay, anyone who’s visited Iceland on vacation will be able to tell you that it can be really expensive, costing over $10 for a domestic beer in Reykjavik. When you’re actually living in Iceland you need to adjust to the high cost of living.
An average one-bed apartment in Reykjavik, where most expats live, is around $1,550 per month outside of the city center. This is without utilities or any other costs. It’s estimated that you need around $1,500 as a single person to comfortably live in Reykjavik without including rent, so you’re looking at spending around $3,000 per month as a solo person in Iceland.
2. Availability of Items
Being an island a few hours away from both Europe and North America, it takes a long time for any imported items to get to Iceland – and the majority of goods in Iceland have to be imported from overseas.
This often means that many of your comfort food favorites might not be readily available in Icelandic supermarkets or on menus in restaurants around the country. You might have to say goodbye to some of your favorite spices or ingredients, or – if legally allowed – bring them in your suitcase!
3. Icelandic Attitudes Toward Expats
Now, on the whole, Icelanders are friendly people as long as you treat them and their country with respect. Sounds fair, right? Well, some expats have experienced rudeness or just flat out being ignored by locals, mostly for not speaking Icelandic as someone who now calls the country their home,
Although Icelandic isn’t a common language that’s taught around the world, if you’re planning on living in Iceland, you need to make a concerted effort to learn the language before you move. Of course, you will acquire the language much quicker when you get there but you at least need to know all of the basics before you arrive.
4. Winter weather
Given Iceland’s northern location, the winter weather can be intense for some expats. With average temperatures that hover around 0°C (32°F), you’ll need to wrap up warm throughout winter and prepare yourself for snowy and icy conditions.
In terms of snowfall, Reykjavik does get a little bit but it doesn’t normally stick around for too long. If you’re looking for a snowy wonderland, head to Akureyri in the north, where you can ski and snowboard.
5. Public Transport
Realistically, because so many Icelandic towns and cities are walkable, there are next to no public transport services around Iceland. While you might see a lot of buses, most of these are tourist tour buses that are heading out in search of the Northern Lights or going out to the geysers.
Getting between different towns and cities in Iceland on public transport can be tricky and confusing which is why most people choose to drive around Iceland’s ring road. Even getting to and from the airport in Keflavik can be a headache if you don’t book ahead.
6. Travel Options
On the topic of airports and travel options, realistically, if you want to get anywhere outside Iceland, you need to fly at least two-three hours. There are international airports in both Akureyri and Keflavik (the closest one to Reykjavik), and they tend to connect Iceland to Europe, the US, and Canada.
While there are ferries that go from Denmark to Iceland via the Faroe Islands, it takes two days in total to get there. It does mean you can bring your car with you but it’s still not a short or cheap way to get to or from Iceland.
How much money do you need to live comfortably in Iceland?
It’s estimated that as a person living alone, you’ll need around $3,000 per month to comfortably live in Reykjavik, the capital of Iceland. This is where the majority of expats settle down.
For a family of four, the amount you’d need per month is around the $7,000 mark. It’s not cheap to live in Iceland by any means!
Can I move to Iceland to retire?
If you’re planning to retire in the Land of Fire and Ice, you’re going to need a permanent residence permit. The thing is, you need to have lived in Iceland for at least four years to be eligible for this permit. So if you want to retire in Iceland, you need to live and work here for a few years first!
Are Icelandic people friendly?
Yes, on the whole, Icelandic people are very friendly and warm as long as you’re respectful. If you’re not respectful or refuse to speak Icelandic after moving to the country, Icelandic locals can be a bit frosty towards expats! That being said, generally speaking, Icelandic people are super chilled out and relaxed.
Is it difficult to learn Icelandic?
Let’s be honest, Icelandic isn’t the easiest language for English speakers to learn, but it’s not the hardest by a long shot. The US Foreign Service Institute puts Icelandic’s difficulty level somewhere in between learning French and Chinese.
It’s likely to be harder than the Latin languages that many English speakers learn in school, but it’s nowhere near as difficult as tonal languages like Mandarin or Cantonese. If you want to be fluent, you need to put in around 1100 hours of study, so you better start learning Icelandic right now!
How much does the average house cost in Iceland?
The average house price in Iceland is anywhere between $382,500 and $479,000. This obviously goes up or down depending on whereabouts in Iceland you plan on living, the size of the property, and any amenities or additional features that are included like beautiful views or sauna facilities.
Even though the cost of living in Iceland is high for food, drink, groceries, and more, honestly the rents and property prices are pretty similar to a lot of major cities in Europe and the US right now.
Is it easy to get a job in Iceland?
With such a small population and a small job market, it’s not exactly easy to get a job in Iceland. To be honest, you’re probably better off having a remote job outside of Iceland and moving there on Iceland’s remote worker visa. Unless you have very specific skills that local applicants don’t have, you might find it difficult to get a job in Iceland as many employers prefer to employ local Icelanders.
How much tax do you pay in Iceland?
The amount of tax you pay in Iceland depends on your individual income and is split into three brackets. If you earn up to 409,986 ISK ($2973.71) per month, you’ll pay 31.45% in tax. If your monthly salary is between 409,987 and 1,151,012 ISK ($8348.53), you’ll pay 37.95%. Finally, if you earn over 1,151,012 ISK ($8348.53), you’ll pay 46.25% tax. As many services in Iceland operate on a socialized system, these high taxes go back into things like subsidized education, healthcare, social care, and more. So although they seem very high, the costs may equal out in the long run versus private healthcare, education, and social care in countries like the US.