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If you put a sunset clause in your prenup, don’t forget about it

On Behalf of | Dec 4, 2022 | Family Law

When you put a prenuptial agreement in place, there’s no expiration date on it – unless you include what’s commonly known as a sunset clause or sunset provision. Some couples will replace their prenup with a postnuptial agreement, or postnup, at some point after the wedding takes place.

Some people draft a postnup early on in the marriage because they never got around to a prenup. In these cases, it essentially includes everything a prenup would have. Many couples get a postnup years into the marriage to replace their prenup if financial or other circumstances have changed and they want to adequately protect their interests.

A sunset clause can designate the prenup to become invalid after a certain number of years (typically at least ten) or when a specific point is reached, like the birth of a child. The idea behind them is that by that point, they’ll be sure about the marriage surviving (although long-term marriages end all the time) or that the provisions in the prenup will be outdated and irrelevant to their lives.

Letting the prenup lapse can be a costly oversight

Where some people make an expensive mistake is to let the sunset date come and go. There have been some high-profile cases where a spouse has filed for divorce shortly after the prenup lapsed and gotten a very generous settlement because the other, wealthier spouse no longer had the protection of the prenup. In some cases, a spouse with a prenup highly favorable to them may file for divorce just before the agreement “sunsets” and they could potentially walk away with far less.

If you’re putting a sunset clause in your prenup, make sure you have that date or event committed to a calendar or other reminder system. Even if things are rolling along happily at that point, it never hurts to consider replacing it with a postnup. As with a prenup, both parties should have their own legal representation to protect their interests.