Now that you are editing the file you need to add the line into the server block, like so;
server {
client_max_body_size 8M;
//other lines...
}
If you are hosting multiple sites add it to the http context like so;
http {
client_max_body_size 8M;
//other lines...
}
And also update the upload_max_filesize in your php.ini file so that you can upload files of the same size.
Once you are done you need to save, this can be done in vi with pressing esc key and typing :wq and returning.
Now you need to restart nginx and php to reload the configs. This can be done using the following commands;
sudo service nginx restart
sudo service php5-fpm restart
Or whatever your php service is called.