Posts above answer the questions I'm just adding in more input.
I'm running 4.1.9
2 questions:
1) How - specifically - so I upgrade to 4.2 ? -
There is a vBulletin readme file that is very simple to understand in the zip file that you download. There is also a vBulletin maunal - https://www.vbulletin.com/docs/html/. Type in 'upgrade'
2) When I upgrade, will I lose mods (e.g., extensions, changes to templates, etc) that I made. -
Since you are on 4.x already. No you should not lose any mods. Changes to templates can be easily updated by reverting them or making the changes after the upgrade.