When to select New Package OR Existing Package while creating a Package

Dear All,

I searched in google but i have little bit confusion.

As i understand now Layer is not much important as earlier version.

For development i can choose any layers between (USR,CUS,VAR) while creating a new Model.

For example :

1. Suppose i created a new Model : "Model 1". and choose Layer "CUS" 

2. Now i have to select "Package" : We have 2 options > New Package or Existing Package

Can you please let me know when to select New Package OR Existing Package ?

Please give me an example.

Thanks!

Regards,

Arpan