1. Connect the iPad to the computer that you ORIGINALLY synced it to. If you sync it to more than one computer, you run the risk of wiping your iPad clean.
2. Once you have connected the iPad to the computer with the cable, open iTunes.
3. After iTunes has recognized your iPad, find it in the left-hand sidebar and right click on the iPad name.
4. At this point you must follow the next 3 steps in order to ensure your data will not be erased when you update:
A) Back-up the iPad (this will copy any data you have attached to your apps and place it on your iTunes account)
B) Transfer all purchases from the iPad to the computer (this will ensure that your purchased apps do not get erased)
C) Sync the iPad (this will transfer all of the checked boxes from your iTunes account onto your iPad- remember that you can pick and choose which tabs (books/ music/ TV shows/ movies/ etc.) get synced)
** These three steps do not need to be done in order.
5. After completing these three tasks it is safe to update the iPad and your apps and data will not be erased. (**Please note that sometimes dialogue boxes open asking you to perform a function. It is best to decline the operation requested unless you are sure what you are doing.)
(thanks to Rebecca Allison!)::