Use a desktop or mobile wallet (Electrum or Mycelium) to spend bitcoins (be sure to write down your recovery core and keep it like a wallet). Use offline paper folders to receive and save them. As soon as a paper wallet exceeds a certain amount (e.g. 50 mXBC), store it and start a new one. If you're spending money and your online wallet is empty, open a paper wallet to complete the transaction. All remaining coins remain on the online wallet.
NOTE: By "online wallet" I mean wallets like Electrum and Mycelium, Not Web wallets like Coinbase or the Blockchain.info wallet.
Someone posted instructions for wallets on Bitcointalk:
Do your own research before risking your coins.
Do not use wallets.
EDIT: Brain wallets (storing a passphrase that is used to create keys and addresses) are highly controversial in the Bitcoin community. Proper use is choosing the passphrase evenly and randomly from a large amount (at least 2 ^ 128).
Security improvements include:
Add salt to the passphrase (something unique that you shouldn't remember, such as your full name, phone number, or email address) to prevent hackers from attacking everyone at the same time.
Using Keystroke WarpWallet is an algorithm that uses a difficult, memory-intensive algorithm to derive keys from a passphrase a lot of harder to chop.
To generate multiple wallets from a passphrase, you can add an index (add a number to the passphrase).
The main advantage of wallets is that there is no physical wallet that could be stolen or confiscated, and that it is plausible to deny Bitcoin.
Disadvantages include the difficulty in remembering the passphrase (if you forget it, the coins are gone), the possibility of theft (there are hackers who constantly monitor addresses created from weak passphrases, and they immediately steal coins ) and the fact that in the unfortunate event of your death, your family would not be able to recover your coins.
If you want to use them, you can use them instead of the paper bags in the first paragraph.