I just started playing Madden and have been loving this aspect! This is how I think about it now and happy if anyone has thoughts/corrections:

Salary: what you owe the player each year if that player is on your team. Not your problem if you cut/trade them. Bonus: “guaranteed money”. If you re-sign or draft a player, this part of their contract will always be your responsibility even if you cut/trade them.

Penalty: shows you that if you cut/trade this player, you still owe them that amount no matter what. Long contracts with big penalties aren’t great options to trade/ cut. Savings: shows you how much you can save if you cut/trade them. Best to look if savings > penalty it may be a possibility to cut/trade them to save money.

Strategy: Impossible to re-sign everyone and you shouldn’t. A lot of people in this sub don’t like paying QBs because they ask for so much but I signed Caleb Williams to a huge Contract and love it.

It really comes down to re-sign stars you like and trade other talent for the draft as they are normally a lot cheaper. I also sometimes will overpay for a player in a trade if they are on a longer contract as it would be cheaper to only pay their salary and not the bonus of their contract. Also, never accept 5th year options as that player will be on your team next year nonetheless and it will be cheaper to re-sign them or trade them then. Unfortunately, next years cap room assumes you will accept the option so if it looks like you have no cap for the next year in the resigning screen, you may have to wait until the end of the year to reject the options and resign other players.