One time I was in the playground and some new kid stared at me and asked "Why are you so ugly?"
I said she wasn't supposed to be using that word but she didn't listen. Later, I made it clear that words are actually dangerous, if you don't use them nicely.
She understood. We became best friends.
If someone is being rude, make it clear to them that what they are saying is rude.
And never, ever, bully yourself.