That's a good guideline to start with.
Then, if your plant is really bushy, give it some more space. So a 18" plant with one main stem might be happy in a 1-2 gallon pot, but a plant of the same height, with 4-6 main leads, would definitely benefit from a 3 gallon pot.
Remember to put the plant in the smallest next size up that makes sense. So go from a party cup to a 1 gallon pot, not from a party cup to a 5 gallon pail. Remember when you were a kid and your mom would say, get your sneakers a little big because you will grow into them? And then they fit funny and by the time your feet fit them, they're all fucked up anyway. Some kinda idea.