Hi BSims! 

The good news is - and you are already aware of this - is that CLM is very flexible in how you can handle contract renewals! While I can't tell you what will be the best way for you all, I've seen customers of all types handle renewals in varied ways. 

I can tell you a few questions to ask internally, though, as you are determining the best renewal process for you all. 

1.) Are users searching for the previous versions of the contract? 
2.) Are users reporting on the previous versions of the contract?
3.) Are users referencing the previous versions of the contract frequently?
If any of the above is true, then keeping the expired contracts as separate documents, with it's own separate history and attribute data, will likely make it easier to continue doing these tasks.

4.) If the issue is having multiple documents in the same folder, can you expand your folder structure so that any expired contracts get moved into an 'Expired' folder and the latest version can live in the main customer contracts folder?

If it's just an extension where no new contract is signed, then updating an expiration date attribute to reflect the new dates would be fine as long as you are not needing to search or report on the previous expiration date. The history of the document will reflect this change so you will be able to see the previous value if needed. 

I hope this helps in narrowing down the best option forward around contract renewals for you all.

Thank you!
Kelly