With all the new compact model announcements, several discussions about marginal improvements over the previous general have come up. Unless your camera breaks, I'd say upgrade at the earliest every 3rd release from your current model. When that release is made, you might even opt for a latter general model rather than the latest.
Why? Because you're not going to vast improvements with a new model coming out every year and it's debateable if even the next model would be the upgrade you are looking for. This goes for both basic point and shoots, as well as your advanced compacts (for DSLRs, I'd say every other generation is a pretty good upgrade because the wait is usually longer).
For example, if you have an S90 then an upgrade to a S110 could be the right upgrade for you. The advatnage S90 users have right now is that they can decide between the S100 and S110. The extra year's wait, I'd argue, is worth the cost savings and the user makes a purchase based on informed decision rather than an impulse buy. If you have an S95, however, you probably want to wait at least another year, even if just to see what's going to be in the S120.
I currently have a Canon G9 that serves me pretty well. Based on my logic, I ignored the G10 and looked at the G11. I still didn't see the need to upgrade. The G12 caught my eye, but I didn't get around to getting it because my G9 functioned fine. Now the G15... I might even wait longer. I've basically taught myself patience... but that's always been who I am.