My band's recording setup for vocals and drums:
Some mics we borrowed -> An old mixing board that was on loan to us for about a year and a half -> 1/4" to 1/8" adaptor -> Computer mic input -> Audacity
Setup for guitar and bass:
Amp -> 1/4" to 1/8" adaptor -> Computer mic input -> Audacity
This didn't cost us a dime (other than what we spent on stuff like amps that we needed anyways). The vocal setup was a pain to get together, but for just guitar stuff all you need is a 25-30 watt amp (these produced the best results for me but lower wattage amps work too) with a headphone jack, a 1/4" to 1/8" adaptor, and a computer with Audacity (it's a free download google it). You probably already have the computer and the amp and the adaptor is like $3 (I got mine for free from a friend).