You are in luck. There is a untethered jailbreak solution for your device.
The tools are listed below, click on the name to view the guide.
- How to Jailbreak iOS 4.2.1 with Sn0wbreeze 2.2.1 (Windows)* preserves baseband
- How to Jailbreak iOS 4.2.1 with Greenpois0n RC6.1 (Windows) (Mac)
- How to Jailbreak iOS 4.2.1 with Pwnage Tool 4.2 (Mac)* preserves baseband