There are two options to upgrade your droplet to a larger size.
The first, fast resize increases or decreases your CPU and RAM according to the new plan selected [but does not resize the disk]. The benefit is the resize is processed with a simple reboot: shutdown your server from the command line, select the new size, and then click "Boot" from the control panel,
The second, a migrate-resize will move your virtual machine to another hypervisor and also resize the disk in the process. This process is longer and can take up to 35-40 minutes, depending on the size of your virtual server and how much diskspace is being utilized.
Below is the tutorial on how to resize Droplets using snapshots:
Please note that once you resize to a larger disk, you will no longer be able to select a smaller plan for a fast-resize. This is because there will be a disk mismatch and you cannot currently shrink a droplet's disk.