Take your time and build up your gear. Approach each new area with caution and only enter when fully prepared. That's truly the key. Also, if you aren't already, make sure you parry with your block (right click). When I first stated playing, I rarely ever used block and that's a big mistake.

If it's still overwhelming, try adding some mods. Something like "EpicLoot" can make the SP experience far easier as it has some overpowered drops (it also adds SP quests when you meet a trader). "EpicValheim" is another great mod that allows you a ton of control over the game including difficulty and drop rates, so long as you are willing to make changes in a text file. Using Thunderstore mod-loader, you can mod Valheim without impacting the base game installation in any way. Easy-peasy.