You have sufficient storage on that SSD drive. With just 8 GB of memory though, and the increase in demand for operating system resources from Big Sur, you won't be able to run several large resource-demanding applications concurrently.
For instance, Adobe's minimum memory requirements for each of Lightroom and Photoshop are 8 GB apiece, and the preferred available memory is double that figure. You are attempting to use both in 4GB of available RAM after Big Sur consumes its share.
You are also under-configured for Graphics processor (GPU) memory, as Adobe sets a minimum of 2GB for each of Lightroom and Photoshop and double that for each when using a 4K or greater display.
Your six-year-old SSD may be slowing down from natural causes or may have some need for you to boot into Recovery (⌘+R) and run Disk Utility First Aid on it. If you have never done this, it may be a good idea.
You may, or may not, have malware installed on your Mac. I would recommend downloading the free Malwarebytes, let it determine if malware is detected and removed, and then from the Malwarebytes Help menu, uninstall it too. If you don't, its 14-day full-featured trial will run at elevated system privileges and consume operating system resources that you need for the Adobe products.
And then there is Kurt Lang's recommendation for uninstalling and reinstall the current Adobe Photoshop 2021 product.
Once all of the above has been accomplished, your iMac will have been provided every opportunity to run Adobe products as optimally as it can for its configuration, which may not be enough for your current workflow.