Each December of the last three years (2012, 2013, 2014) my wife and I have gone to see The Hobbit in theaters while our kids are at school/pre-school. This year my 7 year old started asking about The Hobbit and we explained to her the movies are based on the books (The Hobbit + Lord of the Rings). She was really curious about the story, so my wife has been reading The Hobbit to her a bit at a time each night before bed.
My daughter is really enjoying the book. On top of this, it gives a chance for me to focus on my 4 year old before bed. Her and I have been reading different books before bed and it's been a great daddy/daughter experience.
Back to my 7 year old. Now she wants to watch the movies and I'm really excited about that. However, I want to wait a year or two. The movies are rated PG-13 and there's quite a bit of violence/blood. I think she's close to handling watching the movies, but I'm going to give it a year or two. That's a long wait...for me! I can't wait to share the experience of The Hobbit and The Lord of the Rings with her!