A TSA has 60 days from time of enrollment to upgrade and only pay the difference.
If they upgrade from Coach to Business Class after 20 days from time of enrollment, they will have 40 days remaining to upgrade to FC and only pay the difference.
If they do not upgrade within 60 days of enrollment, they will be able to upgrade at any time, however, they will pay the entire price.
Upgrading from Standby is a bit of a misnomer ... as Standby is where everyone starts. For example, if you started at First Class, you would have paid $49.95 (Enrollment Fee) + $1000 = $1049.95. So when you start at Standby and purchase a pack later, you have to pay the price of the pack. However, when you upgrade from Coach to Business Class within the 60 days from enrollment, you will only pay $500 - $250 = $250.
If you upgrade from Standby to Coach or Standby to BC or Coach to Business Class, you do NOT get a new 60 day upgrade clock. You will always have 60 days from your ENROLLMENT date to upgrade and only pay the difference. This is why the upgrade timer on your dashboard pertains to those who are at Standby. Sitting at Standby for 60 days means that you will no longer have the opportunity to move up in steps and only pay the difference.
If a person waited 61 days to go from Standby to Coach, and later decided to go to BC, they would have to pay $500 instead of just $250.