It really is a personal choice. I started out very similarly as the OP described - seemed like I could never get ahead. But I stuck it out for 2 reasons - #1 being I "knew" that wrenching is what I'm good at (tried other work previously and it wasn't "working") , #2 -it was the busiest hourly paid work I could get (meaning unlimited potential to work and get hours = pay). The other big thing I tried to do differently was that I went into equipment work since I felt like automotive work was too unstable. I had a few years experience on construction equipment in the military and that lead to lot of job offers when I got out, but not much money was offered to start.
It was tight, and we where pretty broke for a long time, but the big priorities where met - bought a house / safe place for the family to live, dinner on the table, decent benefits (health insurance, etc). I did buy tools of the tool truck, because the web didn't really exist and I had no other credit to get anything that cost cash I didn't have. We budgeted 50 bucks a week to the toolman right off the bat....I worked a lot in the beginning - around 70 hours / 6 days a week to be able to do anything beyond just barely surviving.....It progressed over the years to where I'm making good money, working less hours, the bills are paid with ease, money being saved and we can afford a lot more than sitting around feeling broke. It just took time. I had to learn to be patient for a lot of things.....I was 40 before I bought a brand new car, but this year I bought myself a big tool box that was just because I wanted it - not really a "need" this time.
The key to wrenching for a living IMO, is you have to make yourself irreplaceable -- there's 10 other guy looking for work, so you better shine and be the guy the boss does not want to loose. You gotta have something that sets you apart from the crowd.
I fell into a specialty in equipment by accident, but I learned it inside and out and have always tried to keep a "do it all" attitude - whatever it takes. I have tried very hard to NOT become the prima-donna ( you know - the "I'm sooo good at XXXXX I refuse to do other jobs" attitude you hear from some guys) Now as the shop lead /service mgr, I give the gravy work to my other mechanic and tackle the worst PITA jobs myself because I know I CAN get it done better / faster than anyone else even when it's a job I despise. I will also still dive into a messy / PITA LOF if that is what needs to be done..... I tried to quit once, the boss's answer was "What will it take to make you stay?"...we worked it out....I'll mark 18 years at this job in September......
I have also experienced some of what Dan described - even though I'm well paid, the boss won't pay enough to start another guy even though we need more help. Now, mind you, we are in one of the more expensive parts of the country - pretty much need a household income over 100K a year for a family unless you like the ghetto......They want me to start a road service guy and set up a truck, but I'm not asking any mechanic I feel is worth having around to come work for 15 bucks an hour...and the guys who would work for that, I don't want around. I have left hiring up to the boss's to look at the resumes and call / interview guys since they ultimately have to approve the guys paycheck.