I’m a student, not rich, without a second job, and without a publisher, but I love to create games.
So my project-budget for Grappling Hook was almost zero, but fortunately, there are some great freeware and open source projects.
I will present you every tool that I have used during the development of Grappling Hook.

I already wrote an article about, how great Java is for game development and my opinion has not changed since then.
You can find the article here.

Eclipse is a great free IDE. It offers syntax-highlighting, code-completion, refactoring-tools, a debugger, Java-doc-generation, good search-tools, code-formatting, neat-project-overviews and a lot more.
I had to work with Visual Studio and I wished every day, that it would be at least half as good as Eclipse. With Visual Assist X things get a lot better, but you have to pay for it.
Good alternatives: NetBeans

The jMonkeyEngine is a general purpose engine written in Java. It is build on top of LWJGL and offers a scene-graph and many cool features, for example shaders, terrain, particles, shadows, many model formats .
Some features are missing like a good physics integration, but the community is working hard on it. The community is one of the best I have ever seen. They are active and very helpful.
Beside Grappling Hook, there are other commercial projects using the engine, like Mad Skills Motocross or Bang Howdy.
When you are looking for a free engine to develop a game, you should definitely evaluate the jMonkeyEngine.
Good alternatives: Unity, Panda3D, Ogre3D

Blender is a free 3d tool offering all features you can dream of as a 3d artist: modeling, uv mapping, shading, rigging, animations, rendering, compositing, and also physics and a game engine.
When you are used to 3D Studio Max or other commercial 3d tools, Blender will feel a bit strange. But you will get used to it soon and it will pay of, because you can do everything with blender, that is possible with commercial 3d tools.
Alternatives: Wings 3D, GMax

Thanks to every developer and contributor of this projects! You are doing great work and make dreams possible!

What is your favorite programming language, IDE, engine, or 3d tool and why?

To be continued.