If transferring all funds every-time is required.
Not required, but strongly encouraged because paper wallet is more suitable as cold wallet.
If I forget to transfer the remaining funds to other address can it be easily hacked?
No. The risks of your private key is exposed by stealing paper wallet is still same
Won't there be a confusion as in which of my address is holding the account if, this process happens regularly?
Paper wallet usually only have an address
How fixable is it to use paper wallet in this case?
Zero, if you use it like regular wallet.
The lines I quoted are from Mastering Bitcoin. An I have heard that this book is like Bible for understanding Basis. It says that the private key will be compromised.