Regarding hardware I record with a Blue Snowball cardoid mic and a pop filter. The entire setup including mic, stand, and pop filter cost me a little over $100 on Amazon. Pluralsight also reimbursed the majority of that after my first course was delivered. (http://www.amazon.com/Blue-Microphones-Snowball-Microphone-A...)
Regarding software I record and edit with Camtasia for Mac ($99) on a MacBook Pro. I've used Camtasia for my last three courses and while the Windows version is quite nice the Mac version is...painful. I'll be starting a new course in January and plan to record with Screenflow (http://www.telestream.net/screenflow/overview.htm) and edit with Adobe Premiere. Screenflow and Premiere are more expensive options and, as painful as Camtasia was to work with, it was more than adequate to get me started.
I also use a bevy of other free tools to support the production process. For example, I do all scripting, outlining, etc in Google Docs and track the entire production process in Trello. Each course is a fairly large undertaking (the course I'm wrapping up now will have about 135 hours into it by the time its done) so being able to keep track of where you are and how you're pacing for the deadline is critical.
I also have a full time job, am married, and have two young kids (a 3 year old and a 3 month old) so I have to make time for production at odd hours of the week. This makes trello all the even more important for helping me manage the process ;)
Let me know if I can give you any more information.