How to upgrade jailbroken iPhone 4 with iOS 6.1.3 to iOS 7.0.4?
Restore the device with iTunes (connect the device and click Restore in iTunes).  
Once the device is restored, set up the device using an iTunes backup and select the iTunes backup that you made before you restored the device.
If you want the device jailbroken, jailbreak the device using evasi0n 7.