Its absolutely imperative you make new backups of your data before updating any software for the above reasons, alone.
You will nomt looseany of your purchased content fomr the itunes/app stores though. You can redownload them directly on the device after restoring: http://support.apple.com/kb/HT2519
If a recent backup contains the data you want, just restore from said backup.
Ultimatley, things can go bad, its all human created afterall. Next time, take the time to cover yourself.