(CNN) -- Confirming earlier rumors, Apple launched a new program Friday that will allow customers to trade in old iPhones at U.S. Apple stores for credit towards a newer model.
Apple already has an online recycling program that lets users trade older iPhones for credit on an Apple gift card. This new nationwide program lets customers bring their phones into stores for a discount on a new handset -- most likely the next iPhone, expected to go on sale next month -- provided the new phone comes with a wireless contract.
You may want to hold off until Apple makes its latest iPhone announcements so you're not stuck with last season's model. The company is widely expected to unveil two new iPhones at an event on September 10.
"iPhones hold great value. So, Apple Retail Stores are launching a new program to assist customers who wish to bring in their previous-generation iPhone for reuse or recycling," said Apple spokeswoman Amy Bessette in a statement. "In addition to helping support the environment, customers will be able to receive a credit for their returned phone that they can use toward the purchase of a new iPhone."
Apple's Reuse and Recycling programs are not new, but they seem to get renewed attention every August, just ahead of September iPhone announcements. A version of program has been available through Apple.com for years. After answering some questions about the state of a device, you can trade eligible computers, iPhones, iPads and iPods for Apple store credit.
The new in-store program will be operated via a third-party re-seller, Brightstar (the online recycling program is run through PowerOn). Prices may vary between in-store and online trade-ins, although there are fewer limitations with Apple's online option. You get store credit that can be used towards any product, and no contract is necessary. Right now, a top of the line, mint-condition iPhone 5 can net $406 in Apple store credit.
Before handing your old device over to Apple, check all your options to make sure you're getting the best price. Carriers including AT&T and Verizon also offer store credit in exchange for old iPhones and other smartphones. Sites like Gazelle and NextWorth will also give a free quote for selling old iPhones, and they pay in cash that you can use on another iPhone, a rival model or a fancy dinner.
To determine how much your old smartphone is worth, Apple and the other companies will ask if it's had any water damage (thanks to a small sensor in the headphone jack, they can tell if you're lying), make sure everything is working properly and check the exterior for scratches and other flaws.
If you have patience, eBay and Craigslist can also bring in good prices for old devices. Or, if you're feeling charitable, there are nonprofit organizations that accept iPhone donations.