What do you say when people ask how good at chess you are ?

in the scheme of things

we are all masters because the rest of world don't know how to play

or play really bad

What an entertaining thread to read.

I tell inquirers that I used to play at a club where I won almost all of my games. Eventually though I was asked to leave. Not because of my level of play but I insisted on playing nude. Turns out most people have great difficulty concentrating when playing a naked opponent or resign early because it's simply too awful to be in the room...

I do my best.

I've never been asked. I live in Alabama, and you can still play outdoor sports here so chess is a non-issue. I get asked, "Who ya for, Alabama or Auburn?" To which I respond, "I don't give a f**k!" This typically produces a moment of awkwardness but it ends the Q&A for that day.

Well, good enough to coach students. I would guess playing for about 40 years should justify what i said. 

i tell him i am  a beginner

I tell them that I am very good, but below average and ranked as 85 of 125 in my club.

Like Capablanca I would tell the person I only see one move ahead.  I like to think it is the right move.

     I try not to lie, but I can be economical with the truth.

A trained monkey could beat me in a few moves.

                                                                               ____________________

Wait a minute!  I don't know any trained monkeys that play chess.

You're right. They can't play.

You can take the modest boast route:

"A master has a 2200 rating, I'm at 2132."

or "I'm not a Grandmaster, but I'm in the top 5% (or whatever you estimate) of veteran tournament players."

You can take the "aw shucks, it ain't nothin' approach:"

"I win a lot more than i lose and the main thing is I love to play the game no matter how each one ends."

or "I can hold my own against most rated players."

You can stretch the truth:

"I'm devastating. There are people who (aborted) gave up the game without making a move when they saw my name.  Twenty different chess teams have begged me to play for them.  Some of the world's best chess masters who are also teachers have asked me to study chess under them.

Chimps are better at chess than humans:

https://www.scientificamerican.com/article/chimps-outplay-humans-in-brain-games1/

As far as feeling weird goes, if someone asks your rating you surely have nothing to be ashamed of - I'm assuming these are mostly non-chess players who don't know how to look up your profile.

Personally, I'm awful at fast chess but have a 2116 USCF correspondence rating - from the pre-home-computer 1970's - and I'm 3-0 in daily chess here. I've also coached a high school team to several county championships and the 3rd-4th-5th place team trophies in 3 consecutive years in the State Championships. But I tell people I have a 1300 OTB rating which is better than 60% of tournament players.  That way I'm not exaggerating and I don't look like an egomaniac since most non-competitive players couldn't care less about most of that!.

It reminds me of when I used to run the mile and two mile run in pre-metric U.S. high school days. Competitors at the starting line would be asking each other what their best time in those races was.  Some idiot would say, "I run the mile in 5:20 and the two mile in 10:30," - which would mean he ran his 2nd mile faster than the first!  You knew he was going to be something like 5:40 and 12:00."

Similarly, ask chessplayers a few questions and it's not hard to uncover the b.s.ers from the honest people.

I'd say, Yes I'm not bad, sometimes I can think 3 or 4 moves ahead, but grandmasters can think 3 or 4 games ahead.