A hot wallet is connected to the internet, while a cold wallet keeps its keys offline. Both have a role in managing crypto.
Hot wallets are free and convenient for spending, trading and DeFi. Because they are online, they are more exposed to attacks.
Cold wallets, like hardware wallets, store keys offline. They are less convenient but far safer for long-term holdings.
Keep a small amount in a hot wallet for everyday use, and store your savings in a cold wallet. This gives you both convenience and security.
Think of a hot wallet as your pocket money and a cold wallet as your savings account. Most people benefit from using both.