Further to Emoji's answer, I would recommend taking a disk image of the virtual machine before proceeding with the upgrade. How you take the disk image will depend on what virtual machine hypervisor software you are using. You can find instructions for VMware here.
Once you have a backup for safety, to perform the upgrade is relatively straightforward using commands:
sudo apt update && sudo apt dist-upgrade
Taking an image is especially important as you are intending to go from 16.04 to 20.04 which is quite a jump. If it goes wrong, you can then easily roll back to where you started.