Quick question - Does gear/weapons quickly get replaced?

I'm mostly asking as in my playthrough with my friends I got a "legendary/unique" (idk what they call the yellow quality in this game) from one of the bosses. The "Falstead's fury", and I love the weapon. However im now starting to get weapons that has nearly double the damage. Im trying to upgrade it to keep it relevant, but the materials needed are obscenely rare (mainly bear paws atm).

Is it normal that maintining a favorite piece of equipment is really hard/expensive as opposed to just replacing it with random gear you get?

For example my falsteads fury sword is rank/level 8 and does 82 damage. Meanwhile a random one handed hammer I just looted (climber's pick) has 133 damage, a significant increase (although the falstead had cold infusion which reduces its damage for freezing properties).

Am I meant to abandon my "legendary" gear whilst leveling or keep them? Upgrading so far seems to require too rare items or not be worth it opposed to just looting new gear that outscales your old ones.