Could a sunset clause be beneficial in your prenup?

On Behalf of | Sep 14, 2023 | Property Division

Prenups are all about pre-planning for a “worst-case” scenario, but a prenuptial agreement that you and your spouse signed 20 or 30 years ago may eventually seem profoundly outdated or even unfair.

Indiana law generally recognizes the validity of prenuptial agreements – but they can be invalidated if they’re unconscionable or something that wasn’t “reasonably foreseeable” would now cause severe hardship to one or both parties.

A sunset clause could help. Sunset clauses basically cause a prenup to expire as soon as the conditions in the agreement are met. 

How can sunset clauses work? 

Sunset clauses can take several different forms:

  • Time-limited agreements: This is probably the most common and straightforward type of sunset clause, where the prenuptial agreement simply terminates after a certain number of wedding anniversaries. For example, you could have an agreement that automatically ends once you’ve been through 10 years of marriage together.
  • Milestone agreements: These cause a prenup to expire when one or more events come to pass. For example, a prenup might only be in effect until a couple has their first child together.
  • Action agreements: These clauses cause a prenup to end based on some action by one or both parties. For example, the prenup can be written with a clause that voids the agreement if either spouse engages in domestic violence or an affair.

Sunset clauses can also set the stage for renegotiations between a couple. For example, a prenup could be written so that its terms have to be renegotiated every five or 10 years. 

If you’re thinking about a prenuptial agreement, it’s only wise to get experienced legal guidance. That way, you can fully explore all your options. 

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