US corporations are allowed to automatically enter employees into a 401K plan.
A basic automatic enrollment 401(k) plan must state that employees
will be automatically enrolled in the plan unless they elect otherwise
and must specify the percentage of an employee's wages that will be
automatically deducted from each paycheck for contribution to the
plan. The document must also explain that employees have the right to
elect not to have salary deferrals withheld or to elect a different
percentage to be withheld.
An eligible automatic contribution arrangement (EACA) is similar to
the basic automatic enrollment plan but has specific notice
requirements. An EACA can allow automatically enrolled participants to
withdraw their contributions within 30 to 90 days of the first
A qualified automatic contribution arrangement (QACA) is a type of
automatic enrollment 401(k) plan that automatically passes certain
kinds of annual required testing. The plan must include certain
features, such as a fixed schedule of automatic employee
contributions, employer contributions, a special vesting schedule, and
specific notice requirements.
You generally have a period of time to stop the first deposit. One I saw recently gave new employees to the first paycheck after the 60 day mark to refuse to join. You also may be able to get back the first deposit if you really don't want to join.
If you don't want to participate look on the corporate website or the Fidelity website to set your future contributions to 0% of your paycheck.
Keep in mind several things:
Personally I'm against any type of government sponsored investments or
savings. I can save money on my own and I don't care about their
- Many 401Ks match employee contributions. Not enrolling means you are throwing away free money.
- 401K contributions can be done pre-tax. Which can save you money, or they can be Roth which can save you money at retirement time.
Some companies provide an annual contribution to all employees regardless of participation in the 401K. They do need to establish an account to do that. Again that is free money
Does it mean if I never contribute any money so I will have 0 I might
go below 0 and owe them money in case they bankrupt or do bad
Even in total market collapse the value of the 401K could never go below zero, unless the 401K was setup to allow very exotic investments.