On overdrafts and automatic 401k deposits

My bank refunded my stolen money over the weekend, so I'm back in business. I will give my bank giant brownie points for one big customer-service selling point: No bounced-check fees. My account has a $1,000 overdraft. So long as I don't go past that $1k, my bank will process checks and debits without charging me any fees. (OK, I pay interest on the overdraft money I'm borrowing, but since I've always repaid overdrafts within days, this interest has never totaled more than a dollar.) I don't make a habit of overdrafting, but when stuff like this account hacking happens, my balance goes zooming into the red. Bounced-check fees are up a record high average of $27.40 per transaction, according to Bankrate's latest research. Not having to worry about incurring giant fees for every bounced transaction is a big relief.

In other tidbits, my company sent out a notice recently that in 2007, it will begin automatically enrolling non-participants in the 401k plan, deducting 3 percent from their paychecks for 401k contributions. (My company matches 50 percent of employees' contributions, up to 6 percent -- so, it'll effectively contribute 3 percent of your pay.) Those automatically enrolled can still opt out of contributing, but they'll need to file paperwork with JP Morgan confirming that they don't want to make 401k contributions.

I think this is a great move. I'm already contributing, so it won't affect me, but studies and anecdotal evidence consistently show that a number of people don't participate in 401ks not because they've thought through the decision and intentionally chosen to abstain, but simply because it's One More Thing to deal with. A recent Hewitt Associates study found that automatic enrollment boosts 401k participation rates from 68 percent to 90 percent. If companies didn't offer an opt-out option, I'd object, but since they do, I think it's a smart step to give people that extra nudge toward participation. I imagine automatic enrollment will be a growing trend.