You can gain xp by battling monsters out on the field. There's also events in the academy and at the player's home that also net you xp. The current level cap is currently 50 if I remember correctly.
At level 5 is pretty doable if you use the right skills, like Natalih's Protection against good and evil, silencing and stunning Ibcht also works really well too.
Just keep healing and doing damage switching out characters that are about to fall. You can recruit most of the party member early on with one or no battles.