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You can upgrade the software by installing a new version over the top. You should not loose any data, however it is best practice to perform a full site backup before applying any update. I recommend using Akeeba Backup.
To update from within Joomla, you need to enter your Download ID in the component options. You can obtain your Download ID by logging into http://www.tamlynsoftware.com/, and clicking on the my subscriptions page.
|Only those with a valid subscription will be able to access software updates.|
Also note that if you change your password on http://www.tamlynsoftware.com/, you will need to obtain a new Download ID.
Once you have entered your download id, you can either use the liveupdate within the component, or use the Joomla updater.