Does anyone actually feel safer keeping BTC on an exchange vs a hardware wallet or is that just cope

Been sitting with this question for a while and I keep going back and forth. My setup right now is split, some on an exchange, some on a cold wallet, and what started as a cautious middle ground now just feels like I created two separate things to worry about instead of one.

The exchange side of my brain says at least if I lose access or mess something up with a seed phrase, the exchange has recovery options. The hardware wallet side says yeah, but you're one platform collapse away from a bad time, and we've all seen how that goes.

What I keep getting stuck on is the seed phrase problem. My spouse isn't really involved in any of this, and if something happened to me tomorrow the hardware wallet might as well be a paperweight. The exchange at least has a paper trail, beneficiary options, some kind of structure around it.

Is that actually a reasonable way to think about it, or am I rationalizing keeping coins somewhere I probably shouldn't? Curious how people with families handle this, because it's not a simple answer and I don't see it talked about as much as the technical selfcustody stuff.

Alt titles: How do you handle Bitcoin inheritance planning when your spouse is not into crypto | Self custody vs exchange when your family has no idea how any of this works | Is splitting BTC between cold wallet and exchange actually smart or just anxiety management