I think it depends on the password, Bluetooth encryption would probably be fine for, like, my forums passwords. If anyone within, like, 50 feet of me right now wants to break into my Hackernews account… IDK, my dog does seem like a real jerk actually, so if I make any dumb posts let’s assume that she’s stolen my passwords.
A dedicated device would be nice and, actually, keeping your passwords on something that never even has to touch the internet would be ideal. But my phone already has a nice big touchscreen to make it easier to pick a password. Reusing an old device could work but that’s limited.