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During the time period that I mulled over that invoice, the client contacted me and asked me if they could refer me to other organizations for work, and also made it clear that they would like to work with me again.

This infomation clarified some things for me: If I charged the clients an exorbitant fee, that would effectively eliminate the possibility that they would recommend me to another organization and also that they would ever consider working with me again. I decided that my reputation and my future endeavors were worth more than extracting a pound of flesh for one project. Therefore, I contacted the client and let them know that a) I had probably worked the estimated hours during the last week of the project alone (which they already knew, having been in constant communication with me during that week) and b) that I understood their budgetary limitations, and would very much like to work with them again and also to receive referrals for other work; I was taking those factors into consideration with my fees. I ended up charging them the equivalent of one month's salary, plus a little extra to cover the taxes I would have to pay on the income. They were extremely appreciative of this.

I realize that I may have opened myself up for them expecting lower rates from me again. And honestly? They may be correct. I struggle with the desire to get rich doing what I do and the desire to be ethical in my treatment of others. I charged them what was fair to me (okay, not completely fair to me), but they will remember me as someone who treated them fairly and who got them out of a bind. That is probably better for my reputation than if the proposal is funded (which we have to hope for, also, but there are no guarantees).

However, ultimately, I depend on good word-of-mouth for my livelihood and my business. So, I traded some income now for hopefully infinite good reports on my reputation. It's a gamble to be sure, but I can live with it.

What would you have done?