Storing passwords unencrypted on a piece of handwritten paper in your wallet is exactly what Bruce Schneier recommended few years ago.

This is the problem my startup is going to solve! It's going to be a service connecting muggers and burglars who steal your physical stuff with criminals who want your passwords! I'm going to call it Robbr!

I used a natty paper notebook for years and in fact I borrowed this method from my mother who seems to feel guilty that she writes this stuff down but I try and reassure her that its ok. In fact I've recently moved away from the notebook for myself because I felt that if somebody breaks into my residence and takes that notebook (not all thieves are ignorant of how valuable a password book is, especially when this contains banking passwords) then all is lost. I'm using the KeePass/dropbox combo with a long passphrase these days though as I've decided that its more secure than the notebook and I can put more explicit information in there (and files), though it is somewhat nerdy so I still recommend the paper notebook for people like my mother.

I am considering that I should store the keepass database somewhere else as a backup but not sure exactly where (at least the file server at my work) and also that I should tell the passphrase to somebody (perhaps an old university friend I don't see often; he does not live nearby or work with me) in case of my untimely demise