If you truly consider yourself a long-term investor, and I mean really long-term i.e. at least 25 years plus, in addition to opening a Junior ISA you may also want to consider setting up a low cost SIPP for your daughter and deposit up to the maximum each tax year and benefit from the free contributions offered by subsequent governments (get your family involved in funding both accounts; both JISA and 'Kids' SIPP's are great ways to minimise inheritance tax - you see I am thinking really long-term here i.e. trans-generational!)
For more on this read: A Little Savvy Report on Helping Your Children to Get Rich at at
http://www.littlesavvyre...r-children-to-get-rich/ - a present each grand parent should consider giving to their adult children for Christmas in order that their grandchildren are spared from years of financial struggles and at the same time become money savvy.
As a long term dividend income investor, I primarily invest in high quality dividend paying companies when they are historically undervalued as well as are financially strong based on our in-house developed dividend share valuation and financial strength investment methods at Dividend Income Investor.com
Successful long-term dividend income investing is depended on the price at which you buy your dividend paying shares and re-invest those increasing dividends in the same and/or similar high quality dividend paying companies, but only if and when they are historically undervalued. This mean you may not invest in new companies for periods if and when none of such companies are around. Also re-read the contribution, above, of the writer talking about his investment in British American Tobacco.
Instead, many investors buy shares when they are 'safe' and therefore by definition 'expensive'. generally, the end result is that you are unlikely to generate good long-term returns when you invest in shares when they are not priced 'right' (based on our long-term historical undervaluation perspective).
Unfortunately many investors do not focus on the price of shares they buy. Instead they get seduced by the media, etc regarding companies with a low price earnings ratio. Always remember that earnings do not provide you with any information whether a company is truly 'profitable' - cash rich - and, are able to pay and increase its dividends on a regular basis (preferably) above inflation rate.
If you don't need the dividends now, re-invest those dividends on a regular basis in such a way that you incur low trading costs i.e. forget about drips etc if your dividend income is limited as the cost of reinvesting is exorbitant; rather gross all your dividend income and wait for the next historically undervalued dividend paying company to have a temporarily bad period or when there is a substantial drop in share prices because the market is generally selling off, and consider buying but only if that/those company(ies) has(ve) the financial strength to turn around.
Steven Dotsch
Managing editor
Dividend Income Investor.com