Do you need a carrier unlock?
If so, DONT UPGRADE TO 5.0 (yet).
Jailbreak should be possible on 4.3.5 or 5.0 but right now it's "tethered" jb only, which is an enormous pain.
Your best bet is to save SHSH blobs with TinyUmbrella right now,
and then wait a bit until an untethered JB is released for 4.3.5 or 5.0.
It might be a few weeks, or it might be more or less than that.
If you don't need a carrier unlock, you can upgrade to 5.0 now-
but a Jailbreak will be more functional and work better at 4.3.5.
If you don't save your SHSH blobs now, you won't ever be able to restore to 4.3.5 later, so do that ASAP.