Simple finance math question

[arghbarg]

If I had taxable interest of $1800 in a year, given todays banking rates for CD's and/or savings accounts what would my balance need to be.

I think I understand that if I have an APR of 1% that would mean I had about $180,000 in the bank for the year, correct? And at 2% that would mean about $90,000.

The best interest rates I have seen for saving is about 1% and 12-18 month CD is ~ 2%. I just want to make sure my calculations make sense. Thanks.

[Alan Bowler]

If I had taxable interest of $1800 in a year, given todays banking rates > for CD's and/or savings accounts what would my balance need to be.
I think I understand that if I have an APR of 1% that would mean I had
about $180,000 in the bank for the year, correct?
And at 2% that would mean about $90,000.

You have funny way of wording it, but yes 2% of 90,000 is 1,800.

Note
1800 / 2% = 1800 / 0.02 = 90000

The problem with a 2% of lower interest rate is that present
monetary policy is aiming at a 2% inflation rate. So even if
you were paying no taxes, a 2% GIC is just standing still.
Outside a sheltered account (TFSA, retirement account or RESP),
you have taxes to pay on the interest, and you are losing money.

This is fine if the deposited cash is being held as a standby
(emergency fund, saving for down planned big purchase or other such).
Think of the loss as an insurance premium.
However for long term goals you also need to invest other funds
in something with some more risk and higher long-term expected
payout. (Low-fee stock broad index fund or ETF is a good start.)