Some prenuptial agreements have what is called a sunset provision or sunset clause. It's essentially an expiration date on all or parts of the agreement. Ten years is a common term for a sunset clause, although the timeline can be as short or long as you choose.
Often sunset clauses are included in prenups when one partner has considerably more money than the other. It's a way of ensuring that if the marriage doesn't last long, the wealthier spouse doesn't lose a large chunk of assets to the other spouse. It can help people feel secure that their husband or wife-to-be doesn't just want them for their money.
Letting a Sunset Clause Expire Can Be Costly
Too often, couples let these sunset clauses expire. Then when they find themselves divorcing years later, the spouse who came into the marriage with more assets and perhaps now is even wealthier ends up paying a significant amount to his or her spouse.
Comedian Chris Rock is an example of someone who had a prenup with a sunset provision that expired before he and his wife divorced after 18 years. The former head of General Electric, Jack Welch, and his second wife divorced after 13 years of marriage. Their sunset provision, however, expired after ten years. Therefore, she was entitled to considerably more of her husband's fortune than she would have been if the couple had split a few years earlier.
Why You Should Review Your Prenup Regularly
All sorts of things, both financially and otherwise, can change throughout the course of a marriage. That's why it's always a good idea to review your prenup periodically to make sure that the provisions you've included haven't expired and still meet your needs.
In some cases, the spouse who went into the marriage with less money has gained considerable wealth on his or her own. Perhaps a provision in the prenup or the entire agreement is about to expire, but the marriage is not on solid ground. These are just two of many reasons not to forget what your prenup says.
Your attorney can advise you of the best course of action if there are provisions that are expiring or that you want to change. Sometimes prenups are replaced with postnuptial agreements. However, it's best to try to plan for as many potential scenarios as possible in your prenup than to hash out a postnup when you and your spouse may not be on good terms.
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