2) Having a paper wallet (encrypted with BIP38). The problem: You can easily lose a piece of paper. The paper can also degrade over time. You would be also stuck with a single public key to get payments, so you would need one piece of paper per address... not good if you need to create new addresses constantly to relieve payments. Controlling coin inputs and outputs it's also harder without software involved.
You can make a backup by
encrypting a renamed text (
notmyprvkey.txt) into a jpg (
notmyprvkey.jpg) file containing the private key by compressing it using any 7zip tool together with a couple of real images.
Renaming the compressed file as "
photos" or "
porn" might deceive black hats.
This is better than just storing your backup in a hidden folder.