Justin Herbert contract: Full breakdown of Chargers QB’s $262,500,000 deal
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When Justin Herbert signed his record-breaking $262,500,000 contract earlier this year, it represented the biggest investment in the Chargers’ future since they moved to Los Angeles four years ago. But what does this massive contract mean for Herbert and the Chargers franchise? In this article, we’ll take a look into the details of this groundbreaking deal and discuss both the team and the quarterback’s perspectives. Read on to get the full breakdown of the historic Justin Herbert contract.
Justin Herbert contract: Full breakdown of Chargers QB’s $262,500,000 deal

Table of Contents

1. Unwrapping the Deals: Breaking Down Justin Herbert’s Record-Breaking Contract

It’s been a wild ride for the Los Angeles Chargers and rising quarterback Justin Herbert. The Chargers landed the Oregon Ducks star with the sixth pick in the 2020 NFL Draft and it didn’t take him long to make his mark. After securing legendary QB Philip Rivers to a lengthy deal, the Chargers shifted their front office focus to Herbert.

The result was a landmark rookie deal for the 22-year-old QB. Herbert’s four-year contract is worth $36 million with an impressive $26.6 million of that sum being fully guaranteed. The massive amount of guaranteed money is the most ever given to an NFL rookie, meaning Herbert’s salary could skyrocket during his second deal. It’s no surprise the deal also includes a fifth-year option that the Chargers can opt to include for 2026.

Let’s break down the major factors of Herbert’s record-breaking deal:

  • It includes $26.6 million of fully guaranteed money.
  • It is a four-year deal for $36 million.
  • It includes a fifth-year option for 2026 that the Chargers may choose to include.
  • It has the potential to pay Herbert more upon his second deal.

It’s clear that the Chargers view Herbert as a cornerstone to their franchise, and his record-breaking rookie contract reflects this in the highest way possible. With such a hefty deal cooking away in the background, Herbert will now be ready to hit the field and make his millions worth it.
1. Unwrapping the Deals: Breaking Down Justin Herbert's Record-Breaking Contract

2. Exploring the Financials: Unpacking the Salaries of the Multi-Year Deal

In order to understand the implications of any multi-year deal, it’s important to consider the individual salaries in each year and not just the overall deal value. Below are the steps for unpacking the salaries of the multi-year deal:

  • Verify that each year of the contract carries its own salary with it.
  • Calculate the average annual value of the contract. This provides a quick visual of the contract’s value.
  • Compare the contract’s total value and average annual salary with any similar or competing offers.
  • Look for any bonuses or incentives contained within the contract which could alter the overall value of the agreement.
  • Consider any bonuses based on performance or other criteria which might change the value of the contract.

It’s easy to just look at the total value of a multi-year deal, but in order to get the most accurate understanding of the financials, it’s important to dig deeper and look at each salary component. Going through each salary and its associated bonuses provides more information that can be weighed and compared. Doing so can be beneficial when evaluating any multi-year deal.

When analyzing the financials, it’s important to take the time to carefully consider the salaries and bonuses to ensure that the deal is truly worthwhile and beneficial. Multi-year agreements may look initially attractive, but after carefully exploring the breakdown of salaries, a clearer picture can emerge of the economic implications of a deal.

3. Dissecting the Bonuses: Taking a Closer Look at the Incorporated Roster Incentives

Employees coming into a company may suddenly find themselves navigating a complicated system of benefits and incentives, resulting in a confusing mess that they have to unravel. To take a closer look at roster bonuses in particular, here are a few key points to consider:

  • Are the bonuses company-wide, or are they offered to particular departments or teams?
  • Do the bonuses vary in value depending on an employee’s position or job title?
  • Do employees have to meet certain conditions or criteria to be eligibile for bonuses?
  • Are bonuses given out quarterly, annually, on an ad-hoc basis or are they tied to performance reviews?
  • Are bonus values adjusted according to inflation rates or currency changes?

Not all rosters bonuses are created equal. Some may provide more value long-term than others, such as offers that lock in rates for a period of time, or extend additional pay if an employee will be taking on greater responsibility. When it comes to larger bonuses, it pays to do a bit of digging to make sure that the offer is in line with market rates, and that employees will be fairly rewarded. Likewise, it’s important to keep in mind the costs associated with managing the bonus system, both in terms of payouts and administration.

Incentive schemes can be a great way to boost employee morale and productivity, but they need to be handled thoughtfully to ensure the rewards are meaningful and reciprocal. Companies should invest time into ensuring their roster incentives offer tangible benefits which won’t cause undue strain on the organization’s resources.

4. Examining the Guarantees: A Glimpse into the Guaranteed Money Provisions of the Contract

The guaranteed money provisions of a contract can be its lifeline. With its complex legalese, it is easy to feel overwhelmed without a deep understanding of the exact language. But with a careful examination of the terms, you can identify the benefits of your contract and the guarantees that have been included. Let’s take a look at some of the money protection package commonly found in a business deal.

  • Insurance: This is an essential element of any contract. Insurance covers any losses that may arise in the duration of the deal and can include a wide range of coverage, such as property damage, legal costs, personal liabilities and more.
  • Escrow: Escrow services provide assurance that an investment remains secure until the deal is finalized. This usually involves an impartial third-party who holds the money until the contract is complete.
  • Reserves: Reserves provide a cushion of protection that can be used in a variety of ways. It may cover the cost of repairs, legal fees or even provide protection in the event of a catastrophic event or unanticipated loss.

These three options ensure your money remains safe during the course of the business deal. Insurance offers protection against unforeseen circumstances, escrow keeps your money secure and reserves give you extra readied cash if needed. By examining the guaranteed money provisions in a contract, you can ensure that your assets remain safe throughout the agreement.


Q: How much did the Chargers sign Justin Herbert for?
A: The Los Angeles Chargers signed quarterback Justin Herbert to a 4 year contract worth $262.5 million.

Q: What kind of money did Justin Herbert make on his contract?
A: Herbert will earn $36 million upfront and $118 million in guarantees. He can potentially make up to $197 million in the four years of his contract.

Q: How does the Justin Herbert contract compare to other quarterback contracts?
A: Herbert’s contract is now the sixth largest in both guaranteed money and total value among quarterbacks. his contract is now in the same range as that of Patrick Mahomes, Drew Brees and Dak Prescott.


The Chargers are no doubt hopeful this contract will pay off. After all, Justin Herbert is a proven commodity and has the potential to become one of the best quarterbacks in the league. There’s no doubt that the Chargers have set themselves up for success by securing Herbert’s services for the next several years. Only time will tell how this new deal pans out, but it certainly looks like the Bolts are in good hands with Herbert at the helm.

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