Update to new version

How do I updated to a new version
Can I keep the old tmpl and use it in the updated version

the file default.php in tmpl folder may have been modified in some update. But you can try to put your one and see if it works. Remember that the best way to modify this layout file is to make some template override !

otherwise, don't forget to backup your theme if you have made some modificaiton in it.

How do I update the extension, install a new one?
Do I have to remove the old one first?

on joomla1.6 you can install the new one without uninstalling
on joomla1.5 you must uninstall and reinstall