Based on a theoretical analysis of time, income and sense of happiness and evidence from Chinese family panel studies, this paper makes a research on the relationship among free time, income and individual subjective sense of happiness of the Chinese family, and estimates the value of money in time freedom by means of life satisfaction method. The results show that time freedom and income have a significant positive effect on the individual subjective sense of happiness for all families. The happiness induced by income increasing 5.89% is equivalent to the happiness induced by time freedom increasing 1% per month. Its implication is that the ultimate goal of economic development centered on the development of human should not only focus on improving income, but also increase the free time to enhance people’s sense of happiness through reform.