From my own experience, paper wallets, or exporting the private key to a text file that is not stored anywhere online are my two favorite ways of storing bitcoin long term. As others have already said, Exchanges come and go and you also have to rely on the good nature of others guarding those sites. Hardware can become faulty in rare occasions. Hopefully, you'll find a solution that's fit for your purposes.
Hardware, as with hardware wallets, can surely break after some time (as with any other electronic). But there's a reason why the 12-24 word recovery seed is heavily recommended to be only stored offline on a piece of paper. .txt files are simply too righ risk especially for your typical non-expert user.