I have always had this problem...how do you hold enough weight to really work the squats? I have been doing squats in the rack with a padded weight bar but it still bruises where it rests across the spine/back. Dumbell squats are worse - I cant hold enough weights in my hands to work it. I feel like my legs could handle significantly higher weights (at 115 lbs now), but I am a wuss with holding the weight.
I'm not using much weight, so I can still hold the DBs, but from reading Krista's pages on squatting, is is possible that you're holding the bar in the wrong place (if not - feel free to ignore this ) She says:
Many people place the bar too high, resting it on the base of their neck. To find the top limit of where the bar should sit, bend your head forward and feel the back of the neck. Feel that bony bump at the base of the neck? The bar should never, ever sit on that or above it. Rather, the bar sits below the bumpy bit, on the "meat shelf" formed by the trapezius muscles of the upper back. Your traps are the muscles that hunch your shoulders up. When you retract your shoulder blades, as in Step 2, there's a little shelf of muscle that is formed on the upper back, and that's where the bar sits. Initially you may find that your shoulder flexibility limits your comfort in holding the bar. Try taking a wider grip on the bar. Over time, and with stretching, this problem should disappear.
Mine has at least an inch of heavy foam padding. I've gone up to 200# without any bruising or marks. What kind of padded bar are you using?
BTW, I totally agree with you about DB squats. My grip gives out long before my leg strength.
Not just grip strength, once I have to move to plate DB;s I keep whacking myself in the thigh. Too bulky for a little person!
My gym has something that looks like that which is what I have been using, maybe if I buy my own it will have more padding. I'm wondering if the one at my gym is just all worn out. I wouldnt be surprised.
Thanks Pat, I had kind of figured out I was doing that part wrong so the last couple times I moved the bar lower and now I just have bruises in different spots, but at least they arent as much spine as NEXT to the spine when I hold it low. --Maybe I just need to work my back more to build up that shelf she is talking about!
Ah ha, I bet the pad that belongs to your gym is totally worn out. That's what happened in my gym so I bought my own that I keep in my gym bag. It makes a huge difference!
If you want to build up some muscle in that area, try shrugs.
I've gone up to 105lbs on my back with the barbell and am having no trouble with just a folded up fleece blanket under it. It looks a little silly but I'm just in my basement. I rest it below my neck though, just kind of below shoulder level, at the top of my back. There's a really small area there that I can handle it without it hurting too much but it took me a bit of playing around (and bruising) to find it.
The velcro on the squat pads at my gym are worn out too. It can be a bit scary: there's nothing quite like being halfway down in a squat with 200lb on your shoulders and feeling the velcro start to loosen and swivel. But I use 'em anyway. Beats having bruised shoulders.
I find rolling my shoulder back & squeezing my shoulder blades in before I take the weight of the bar on my back helps to form that "meat shelf" better. I have never used the pad & haven't had problems with bruising.
I use a pad like Meg showed you. I would suggest making sure that you've got the bar in the right place and that the pad is newish. I'm don't have much natural padding on my shoulders and routinely squat 185 and up without bruises. I do get bruises with the same weight on a squat machine where the weight is supported only on my shoulders.
If I do dumbbell squats, I use a single dumbbell and hold the top plate with both hands. I usually do them standing in two benches with the weight going down between them cause those 90-110 pounders are BIG. That enables me to get deep enough.
Squats help
But I use 'em anyway. Beats having bruised shoulders. 
