Can I retire in Iceland? What’s the cost of living?

Iceland ranks highly on many indices as a great place to live for the elderly. Many are attracted to Iceland for the peace and security enjoyed by Icelanders, in addition to the outdoors, of course. However, it’s worth noting that on ranking for retiree well being, it is generally assumed to be for the well being of resident retirees. Moving here will be expensive, given the relatively high cost of living in Iceland, so this is something to bear in mind. As a retiree, you will be subject to all the same immigration regulations that we outlined in our Ask Iceland Review on moving to Iceland. As a potential retiree in Iceland, there are several ways to apply for residence. If you are over 67 and have an adult child with Icelandic residence, you are able to apply for a parental reunification permit. There is also an ambiguous category of visas for those with a “special connection” to Iceland. Likewise, you may also be able to apply for a residence permit based on “legitimate and special purpose.” Of course, if you are a citizen of an EU / EEA nation, you need not worry about these restrictions, and just need to worry about the practical matter of supporting yourself during your retirement. However, as a retiree, since you will not be working, you will need to be able to prove you have the means to support yourself during your retirement. This can, unfortunately, prove problematic for some given the high cost of living in Iceland. Although the estimate may be rather low, as it is geared towards students, the University of Iceland provides a useful overview of the cost of living in Iceland here. According to the Welfare Division of Reykjavik City, the basic support criteria for an individual in Reykjavik is around ISK 212,000, around USD 1,477 or EUR 1,483 at the time of writing. Of course, if you want to do more than just survive during your retirement, then you should factor in considerably more than this for travel and recreation. Finally, this information from Registers Iceland on average rental prices in Iceland serves as a good index for cost of living both in Reykjavík and throughout the country. As of July 2022, the most recent information as of time of writing, the average price per square meter for a 2-bedroom apartment in the capital area sits around ISK 3,437 (USD 24, or EUR 24). This will of course vary depending on a variety of factors, but be prepared to pay at least ISK 200,000 (USD 1,394 or EUR 1,399) for a modest apartment in the capital region. Rent is just one factor in the cost of living, but it serves as a good baseline to set your expectations. Of course, choosing somewhere to retire is a large life decision, and visa permits and cost of living in Iceland are just the beginning of things to consider. We hope this serves as a good starting point in your research!