Learn Swedish: Månadskortet är dyrt. Istället cyklar jag. - The monthly pass is expensive. Instead I cycle.

In Swedish, the main verb must be the second piece of information in a main clause (this is known as the V2 rule). Because the sentence starts with the conjunctive adverb istället, that takes up the first position. The verb cyklar must come second, so the subject jag gets pushed to the third position.

I've also seen this written as two words: i stället. Are both correct?

Yes! You can write it as either one word (istället) or two words (i stället). Both are completely correct and mean exactly the same thing. Writing it as one word has become very common in modern Swedish.

Why does the adjective dyrt have a -t at the end?

Adjectives must agree with the gender of the noun they describe. The noun here is månadskortet, which is an ett-word (ett kort). Because it is an ett-word, the base adjective dyr (expensive) takes the neuter -t ending to become dyrt.

Where does the -s- in månadskortet come from?

Månadskortet is a compound word made from månad (month) and kortet (the card/pass). The -s- is a linking letter often used in Swedish to smoothly glue two nouns together into one word.