My goal for my squad:

To have 21 signed 5* and 4* players that I can play in my competitive games and 1 2* or 3* player that I signed from my youth academy or the free agent list.

This way, whenever a new youth arrives or a FA is won at auction, he replaces the previous youth player or free agent occupying the 22nd spot on my squad. They rarely play a competitive game, but are used in every friendly I play.