If you choose to go discless with either console, you won’t be able to use any physical copies of the games you have for your previous generation consoles.
The PlayStation 5 has two options: one with a disc drive, and a Digital Edition that’s discless.
The next generation of Xbox consoles comes with two options: the Xbox Series S (discless) and the Xbox Series X (with a disc drive).
If you have a digital copy of a PlayStation 4 or Xbox One game, it’ll work with either the discless or the disc drive version of the system you purchased it for.
If you have either a digital or physical copy of a game for one system, you won’t be able to use it on the other. Meaning if you have a game for PlayStation 4, you won’t be able to play it on the Xbox Series X|S (and vice versa).
If you get a physical copy of a game, you can use your disc in your next generation console if you get the PlayStation 5 or the Xbox Series X.
If you choose to get a physical copy of a game, but you get a PlayStation 5 Digital Edition or an Xbox Series S, you won’t be able to use your disc in your new system. That means you’ll need to get another copy of the game once you have your new digital-only console.
If you want to get a discless version of a next gen console, make sure to get digital versions of your current generation games for seamless gameplay.