What seating area are you in?

Honest and nonchalant "first."

I'll say "i'm trying to get upgraded to first class"

It sounded as if the guy was just trying to be friendly -- In that case
I'd just say "I got upgraded" -- That makes it clear I bought a coach ticket and implies I'm a frequent flyer. If he asks "Gee, how did you swing that?" I just say something like "I fly so many miles a year that my wife says 'You look sort of familiar' when I get home." Or something like that.

Now if the guy is being a jerk, that's another story...

Agree with Mark. Would add a pivot such as..."the first group. Looks like we won't have a weather problem. Did you have problems coming in?"

He was likely just making conversation and could easily talk about something else with a little nudge.

I would never brag or gloat about being in first, but what the hell is seating group 3? I am not familiar with that term.

he must be a southwest customer...

I actually thought you handled with class.

I am lucky get upgrade to seating 1 would be my answered.

You can always be honest.
You run a small business where you help flyers use their miles, right? Conversations with friendly people might be a good way to get new customers - and at least on this one if the guy was a bore you only had to deal with him until boarding.

The answer I always use: "Oh, I'm sitting up front." It answers the question honestly, but without using the loaded words "First Class".

I think you handled it very well. I probably would've just said I'm in First, and been done with it. But nothing wrong with your approach.

I was in the exact same situation before and I said, "I got upgraded!" I said it with a touch of excitement to make him think that it doesn't happen often -- hoping it would make him less envious. It worked, as he was excited for me. His exact words were, "Awesome! Good for you!" Then he asked me how I got it and we got into a discussion about frequent flyer miles that was pleasant enough. The guy was just being friendly, so it wasn't too bad... I gather your guy was also just striking up a conversation...

He wanted to switch seats with you.. psss.

I would have said

"I'm lucky I'm up front" ..

"I heard that United's first class service is so awesome, I paid full fare first class to find out. I'll let you know after the flight if it was worth it."

The guy was hitting on you, not very well but why else make up a silly conversation.

I've responded as Mark suggested, which was politely regarded, but have never been lucky enough to be hit on.

I tend to agree with JAR and A.S. on this one. An excellent way to humbly have an opening to explain (to some degree.... because your story is rather unique) how you 'work' to get your upgrades and that it could be possible for him too. I tend to think he was just making small talk. But then again, you could have said " I'm Lucky, but I'm also lucky enough to ride up front." 😉

The one year of sign language I took in high school actually comes in handy. I usually sign back to them and they just walk away or ask the question again MUCH louder! We do this a few times and they finally give up.

Should have kept your head down to avoid eye contact as he was boarding!

Sounds like you are carrying around quite a burden there Lucky. "How do I break it to one of these unwashed flyers that I am one of the elites that don't have to worry about such things as, (cough, cough) 'seating areas' and say it without gloating?" The fact that you can't seem to say it without appearing to gloat says more about you than anyone you are saying it to. Hello. You're in a seat with extra leg room. Contrary to what you evidently think, most coach flyers should be able to handle such earth-shattering information without spiraling into the depths of despair and envy. Sheesh. Get over yourself. (Said in constructive criticism.) 🙂

"Negative three"

Wheel chairs board before First on American, so they would be negative 4.

I have also answered 7 before, which is one more than any boarding group I can remember hearing.

Was that really the first time you have been asked that question? I seem to be asked that question a lot when I am milling around the gate waiting to get on as close to last as possible.