How to make MySQL handle UTF-8 properly

Question

One of the responses to a question I asked yesterday suggested that I should make sure my database can handle UTF-8 characters correctly. How I can do this with MySQL?

Answer 1

I followed Javier's solution, but I added some different lines in my.cnf:

[myslqd]
skip-character-set-client-handshake
collation_server=utf8_unicode_ci
character_set_server=utf8 

I found this idea here: http://dev.mysql.com/doc/refman/5.0/en/charset-server.html in the first/only user comment on the bottom of the page. He mentions that skip-character-set-client-handshake has some importance.