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Except that now you've paid almost full price for an iPhone and you're also locked into a 3-year contract.

If you're going to replace it in 5 months and you have to have an iPhone, why not buy an 8GB 3GS for $550, use it for 5 months, and then get an iPhone 5 on contract? Or better yet, get a used 3GS off eBay for about $400. Is there anything about the iPhone 4 that you have to have over the 3GS?

When you get your iPhone 5, you could probably sell a good condition 3GS for $150-200.

Alternatively, if you can live with a different phone until June, you could do even better. The Bell LG Optimus Chic can be had for $250 off-contract, for example.
 

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It should work fine.

However, the Nexus S will go on sale here in Canada at some point, and I've been told that February is the likely timeline. On top of that, I've also been told that it will likely be a slightly revised model, though I don't known what's changing. It may be in your interest to wait.
 
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