When asked a question like that I respond "I'm lucky right now, I don't have to work." They don't have to know that I had a mental break down and had to quit working. As to what you do all day, it is a rude question, and I'd reply, "Oh, I keep busy."

I'm sure she didn't make you feel bad, she just wanted to have conversation. I've been in the chair and the woman cutting hasn't said a word to me, kept talking with co-workers about parties and such.