In the OP it is briefed of not letting you down on losses out of bitcoin and anything else. In recent days there happened the coldcard hack. By the time came through a person's reddit post mentioned by our forum member stating his long term saving of around 2 bitcoin being lost. Those were his entire savings in terms of investment. He lost everything and he lost hope on bitcoin, here there is no mistake on him. Once again to start from the scratch is very tough as it has taken him around 8 years for this. In such situation anyone will go low, for god's sake he has emergency fund and with that he was able to sustain. So, at times when we hadn't made mistake and we were to take the outcome it'll surely make the person emotionally down.
Its heartbreaking, but code-level risk is the cost of absolute sovereignty.
This is why multi-sig and redundant setups exist. Devastating for the guy, but it shows that even cold storage isn't a 'set it and forget it' magic box.