Hi, Liz. In QuickBooks, "losing data" refers to losing access to features in your current plan that are not available in a lower one. The warning you received does not mean your client's data, such as transactions, invoices, and expenses, will be deleted when you downgrade. Instead, it means that features tied to your current plan will be unavailable.
For instance, if you downgrade from Essentials to Simple Start, you will lose access to additional user profiles because Essentials allows three users, while Simple Start only allows one. For more information on what happens when you downgrade your client's subscription, please check this article: Upgrade or Change Your Subscription. It also details the limitations and features available in the lower plan.
If you have more questions, feel free to ask. We're here to help.
