"Failed to prepare the software update. Please try again." pops-up whenever I try to update my iMac

Update as in Ventura 13.6 to current Ventura 13.7 ?

Or upGrade from Ventura 13.6 to macOS 14 Sonoma ?

In either situation

There are factors:

Some which are beyond your control and those with are totally under your control

Like poor Wifi connection

Slow wifi connection

Too many other people downloading at the same time and Apple Severs are overloaded

Software on the computer interfering with the download process including AntiVirus Software

Notation: Disabling the AV Software may or may not solve the issue.

Removal of the AV Software may increase the chances of the download to perform as expected.

Running behind a VPN which may increase Packet losses or corruption of the download 

If via wifi too many Other devices using the wifi at the same time reducing the Bandwidth to your computer. 

Best Results are via Ethernet Cable to Router

Restart in Safe Mode. This will perform a Disk Repair, clear cache files and only load Apple Software, extensions and fonts. The boot up will be slow and can take some time - Normal and Try Again using the Software Update Applet in System Preferences

Worst case - Restart in Recovery Mode and choose Reinstall macOS.

This in theory, will pull the latest version of macOS this computer Qualifies to run

Boot into Restore mode,CMD+r keys...

Look at top of screen for Utilities menu...

In Disk Utility>View, select Show all Devices, highlight the top left entry.

Run Disk First Aid on all items in the left panel, from top down.