Using iMac to edit 4K

You mean a 3.4GHz i5, or 3.5GHz i7.

An i5 may not be able to handle 4K footage because it only has half the number of threads as the i7. Sure, it can handle 4K footage for a while, until it comes to the rendering and transcoding part. At that part, the i7 will be about 40-50% faster than the i5 because of the 8 threads in the i7 (the i5 only has 4).

The Fusion Drive may be a holdback, as the write speeds are far behind that of a pure SSD.

And you should have 32GB of RAM for 4K footage. But try it on 16GB first and see how it goes.

 

I wouldn't call it "far behind". It will work well enough.

To the OP, I would definitely up the memory a bit but to save costs, just have Apple put 8GB of memory in there and you buy the rest. It's cheaper.