Performance of my iMac

while the RAM on 21.5 inch iMacs built in 2014 and later cannot be upgraded, you could always look at SSD options for iMac from OWC. on that page, you can select your model iMac to find capacity and price options. there are bare SSD drives and/or complete upgrade kits. and when you are on your specific mac's model page, you will find the install videos that will help you determine if it's something you would be comfortable doing. and if not, you'll have an idea of what's involved so you can determine what you would be willing to pay to have it done.

+1 on posting your EtreCheck report however if you bought a base model 21.5" iMac it has a glacially slow 5400 RPM HD. There is NOTHING that can be done to improve that. What you can do however is to buy an external SSD install Mac OS on that and then use Time Machine to restore all of your data to the external SSD.

Without knowing the year of the iMac though we cannot let you know which external SSD would be best. When posting, always let us know the year and configuration iMac you have. For example, "I have recently installed Big Sur on my 2013 21.5" iMac with 8GB of RAM and have noticed it extremely slow and was wondering what I can do to improve performance on this machine?" The EtreCheck report is a good idea as it will not only tell us what configuration iMac you have but it will also give us clues as based on what has been installed on it too!

i would think it would be backwards compatible. but it will only work at USB 3 speeds if that's what your mac has. OWC's page says "... that works with yesterday's, today's and tomorrow's Thunderbolt and USB computers...". since it says "...yesterday's..." i would assume it will work with your mac.

Download and run Etrecheck then post the results here using the additional text button at the bottom of the reply window. https://www.etrecheck.com

Yes, please read the following article about Thunderbolt 4 :

https://eshop.macsales.com/blog/72169-everything-about-thunderbolt-4-cables/