What is a Software Update and why is it needed?
A software update is released by Apple whenever they have improvements to the core software running on your iPhone. This core software, the operating system, is named iOS and is responsible for general functioning of your iPhone.
A software update can add new software features to your iPhone, fix issues with general functioning of the operating system software and add enhancements that improve the security of the device.
Is it okay to install it?
It is perfectly normal, even recommend to install a Software Update on your iPhone. Installing a software update most often would require a restart of your iPhone. The restart would be performed automatically as a part of installing the Software Update.
Once started, installing a Software Update can take from a few minutes to around half an hour of time. So make sure not to install it when you would be needing your iPhone for normal usage such as making/receiving phone calls and messages.
I have never used an iPhone before, and I want to make sure I am doing it right.
A software update should work fine most of the times. You need not worry too much about it. However, it may be a good idea to take a backup of your iPhone.
To learn more about iOS, the operating system software running on your iPhone, check this link:
To learn more about installing software update on an iPhone, you can read this Apple Support article:
To learn more about the ways to take a backup of your iPhone, you can read this Apple Support article: