Iowa Attorney General Tom Miller gave a presentation on new credit card legislation coming into effect, as well as student responsibilities and common traps with credit cards.

Miller spoke at 10 a.m. in the Campanile Room of the Memorial Union to a crowd of more than 20 students and reporters.

John McCarroll, executive director of university relations, said Miller’s office had contacted the university late last week in the interest of setting up a presentation on students and credit cards. McCarroll said the university organized the space for the event, but it was still Miller’s news conference.

Miller began his presentation with an anecdote from his time a few years ago as chairman of a financial practices group working on mortgage issues.

At the end of that experience, he announced his interest to work on credit card issues, and a friend of his working in the banking industry said credit cards were the bank’s biggest source of income.

“Credit cards are a big, big deal in America,” Miller said. “They are individual transactions, but there are so many of them that they add up so significantly for all Americans.”

Miller referenced a Purdue University official who said the university lost more students to credit cards than grades. The idea of credit cards is to pay off charges with income, Miller said, but students often fall into a trap because they have no income or their income is used entirely by living expenses.

With the recently passed financial legislation, new consumer protections are taking effect. A new requirement became effective making credit cards available to students 21 and older. Students under 21 must have a co-signer or proof of ability to pay based on income to receive a credit card.

“This is a very significant change and an important change, and one of the things it will hopefully do is bring together students and their parents,” Miller said.

He said parents have always been key in helping students learn responsibility with credit cards, and measures to increase the role of parents in the process should lead to positive changes.

Major regulation of credit card marketing is also taking effect. Credit card companies will no longer be able to entice students to sign up for a credit card within 1,000 feet of campus or a campus event.

“America is an expert at marketing, has been for a while,” Miller said. “Part of the marketing on credit cards has been the T-shirts and all the other gimmicks or relatively low-priced gifts to get people to sign up in this carnival atmosphere.”

Miller said it is a crucial responsibility for students to only use credit cards when they are necessary; stressing the importance of never paying only the minimum balance. Paying the full bill each month can stop a cycle of debt. He also encouraged students to speak with their parents if they are getting into credit card trouble.

Tahira Hira, executive assistant to the president, spoke after Miller’s first statements. Household finance has become a business build on our multitude of purchases and expenses. “Our personal decisions affect our national well-being,” Hira said.

She said the government is working to create a safe environment for consumers, but it is the responsibility of individuals to make responsible choices. “We also have to rise to the occasion and behave properly,” Hira said.

As an example, she asked the assembled crowd if they would consider going to the bank to borrow money to buy coffee. Hira encouraged students to make themselves models of financial decision making that can be shown to the world as examples of good decisions.

Miller said the key to good financial decisions is cash flow management. He encouraged students to understand all of their funding sources and how best to use each one. Staying smart on cash flow management is a skill that will be important for life, he said.