Step 1 - Make the guide.
Since my original video for YouTube is 1080p (1920 pixels x 1080 pixels), I'm going to make my guide the same size.
Then I'm going to make the biggest square I can make within 1920 x 1080, which is 1080 x 1080.
I made my square red, brought the opacity down to 30%, and centered it on the screen.
Now I'll export as a PNG file, making sure that "Transparent Background" is checked.
Now we're going to actually build the video for Instagram. Since I've already cut together the full video for YouTube, I go back through the timeline & select the clips I want to include in the Instagram version. (Click image to enlarge)
After I've selected the clips I want, I hit Command + C to copy, then create a new project under the same event & paste the clips into the new timeline. The instagram guide goes on top of the clips, then I just move them from side to side to make sure everything is in frame. (Click image to enlarge)
After running through it to make sure everything is aligned how I want it, I disable the Instagram guide (click it, then press "V") & export the video at 720p. To get the video onto my iPhone, I upload to Dropbox.com & use the Dropbox app on my phone to download it to my camera roll. When you go to post to instagram, everything will be centered properly!