My phone says that I have to update my phone to use cellular data

it's not talking about an iOS update.. carrier settings I assume

Manually update your carrier settings on your iPhone or iPad - Apple Support

If you see No Service, Searching, or SOS on your iPhone or iPad - Apple Support

Mlilley8949 Said:

"My phone says I must update my phone to use cellular data, after I just updated it"

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Troubleshooting Cellular and Updates:

A. Start Here: If you can't Make or Receive Calls on your iPhone - Apple Support

B. Install a Cellular Update:

It might be prompting you for a cellular update to install. So, go here for that. Update your carrier settings manually on your iPhone or iPad - Apple Support

C. Update the iOS Using a Computer:

• Use my User Tip:  Update your iPhone Using a Computer - User Tip
• IMPORTANT: If you have an option to update, however, then be certain you backup your iPhone first. That way, you will have something to restore your iPhone from should anything go wrong with the update