Link feature/tool not working

I never really looked into the Link process, so I have relied on these steps: after making a change in the image,  I click on the Links menu and:  a tiny verison of the color image appears in the Links work area and the menu type goes from grey to black. That makes it possible to then click on one of the three now-accessible link icons running horizontally below the image icon. Plus a get-info style list of image properties now occupies the lower panel of the menu. I've never gone beyond clicking on the second Link icon in the horizontal list-the one that looks like two links in a chain. As far as updating is concerned, I can't update anything until I get a newer Mac, so am I stuck witht this situation until that happens? OK, I'll drag out my Illustrator C-I-B books and read up on Links. Will that help?

Sorry that I was unclear. The finished product needs to  be a Photoshop file,  and the problem I'm describing is one step in the process wherein I stop working in PS, save the file, then open that file in Illustrator to add something that I can only draw in Illustrator. I then copy my AI addition, go back to PS, where the main file is waiting and paste down the copied Illustrator material, where it becomes a new layer in the PS image.

      What's going wrong now is that, if I save the Photoshop image with the new layer (added from Illustrator), then decide that I want to add yet another Illustrator element, say, an hour later, I'd like to be working In Illustrator over the PS image that I last saved an hour ago, but I can't do that because the "Link" tool only shows me the original PS image from two hours ago, not updated with newer, pasted-in elements from Illustrator an hour ago.  God, that's repetitious. But I hope it's clearer. Baasically, the Link tool isn't doing it's job as it was doing it, say,  five years ago. It doesn't update the PS file.