Backup Your Old iPhone

• Download and install iTunes on your computer, and connect your iPhone to the computer using its USB cable. Open the "Summary" tab in the main iTunes window and click the "Sync" button in the lower right corner. This creates a backup of the iPhone's content and settings on the computer, which will be used to restore the new iPhone to the same status. As a precaution, it's advisable to do the same thing with the new iPhone on the current owner's computer, in case it needs to be restored at a later date.
  
  

Clear Your iPhones

• Before changing iPhones, reset both to their factory setting to remove any sensitive information that may be in applications and settings. Launch the Settings application on the first iPhone, and open the "Reset" page. Tap the "Erase all content and settings" button, followed by the red "Erase" button that pops up. This will wipe the iPhone's memory completely. You can't restore its memory unless you made an iTunes backup previously.
  
  

Change The SIM Cards

• Hold down the power buttons on the iPhones and slide the red button on the screen to the right, shutting the devices down. Insert the iPhone's SIM eject tool into the small hole next to the SIM card tray. The tray will eject, and allow you to remove it fully from the iPhone's casing. Be aware that the current SIM card is not fixed to the tray, and is likely to fall out when ejected. Put your existing SIM card into the SIM card tray, and push it fully into the new iPhone's casing. Press the power button to turn the new iPhone back on.
  
  

Restore The New iPhone

• The iTunes "Restore" feature allows you to apply the old iPhone's backup file to your new iPhone, so it will contain all the same settings and content. Connect the new iPhone to the computer using its USB cable, and click the "Restore" button in the "Summary" tab. Click the "Don't Backup" button in the dialog box; you don't need to back up a blank device. Select the old iPhone's back-up file from the drop-down menu, and click "Continue." The handset's screen will go black and display the Apple logo while the iPhone is restored to your previous settings.