I encountered the same error when trying to upgrade my Premium plan to Family plan. Error message of "Unable to change plans. This could be because you're not eligible for this plan, you're already on it, or you don't have a stored payment method."
I'm trying out the propose solution above by cancelling the current plan. But do I have to wait until the cancellation to take effect (following the billing cycle), before I can apply for Family Plan ?
Actually mine worked. You don’t need to wait for the other plan to end. But it won’t let you do it on your account page. Go to the general Spotify web page and act like you signing up for a new family account. Make sure it’s the one with credit card details and not linked to vodacom. Then fill in cc details and use your same email and password. And you should have a family account. Worked for me. Good luck.