can i use my phone while the new software is downloading?

You can, for the most part; there are only a few times during the upgrade that the device will not be usable (this is noted in the upgrade instructions).  It is recommended, for the most efficient upgrade experience, that you refrain from using your device to make / accept calls, send messages, or for web access while the upgrade is in process.   Doing these things while the download is taking place in the background won’t harm the device, but download speeds will be slower.