With few exceptions, cars with automatic transmissions should always be shifted into overdrive, as it allows the vehicle to shift into the highest gear available. While in a lower gear, the engine may work harder to maintain speed and use more fuel.
The notable situation that calls for shifting into a gear lower than overdrive is travelling over hilly terrain. On downgrades, especially steep ones, a lower gear allows the engine to slow the vehicle. With the help of this engine braking, the driver is less likely to overheat the brakes by relying on them to maintain a safe speed.