Q. "What is a difference between Self respect & Egoistic attitude in day to day life?"
A. In vedantic terms, ego stands for "I-ness" (sense of "I"). If you self-identify with anything, you have
an ego. Ego is not there when and only when there is no self-identification of any kind, i.e. when one is immersed in Brahman without any distinction like "this is I, this is other".
But, in order to exist in a body and function in this world, one needs to keep alive at least a very limited amount of self-identification.
However, in most people, this self-identification is not "a very limited" amount, but really huge. We self- identify with a body, name and identity quite heavily. The goal is to reduce it and keep it under check, so that it is ready to completely melt away one day.
The only useful purpose of allowing ego (self-identification) to exist is to allow one to identify with a body, name etc and use them to do god's work. How does one know what god's work one is supposed to
do? One knows it through one's intuition, one's logical thinking and external input like the words of a guru or other learned men.
How you decide your dharma - what you are supposed to do in this world – is personal and up to you. But, once you decide that, all your actions should be centered around that. The level of self-identification should be barely sufficient for discharging one's dharma. Any self-identification above that level is unneeded and counter-productive. It gets one entangled in unnecessary web of karmas. Suppose I decide that my dharma is to spread homam in the world. Then I should use my body, my name, my image, my thoughts and my actions to do what is needed for spreading homam in the world. Suppose somebody dismisses homam and speaks very deridingly about homam and me. I may argue or ignore. If my judgment is that arguing with him and removing the doubts of people is better to advance my dharma and spread homam, I should argue. If my judgment is that ignoring is better to advance my dharma, I should ignore him. If my self-identification with the name and its fame is too strong and it was offended by his deriding comments on me and I get back to him just for that reason, I am doing something silly and unneeded. Instead, I should look at what actions will help me advance my dharma better.
When Swami Vivekananda lived in US for sometime after his celebrated speech at the parliament of religions in Chicago, he received some good coverage in US newspapers. Some jealous Indian neo- religious leaders conducted a campaign of writing letters to the parliament of religions declaring that Swami Vivekananda was a fake and that he did not represent Hinduism.
Swamiji was a detached soul who did not care what people thought of him. His self-identification with the body, name and image in the world were there only to finish his mission of spreading sanatana dharma and vedanta in the world. After all, once he finished *his* dharma, he did not look back and gave up body.
Still, he did not ignore the taunts and negative letter campaign. He took it seriously. If his detractors were taken seriously, it could have derailed his mission. He needed thousands of important people from across the world to be influenced by him and start vedanta societies in various cities (and co-operation from parliament of religions and positive media coverage contributed to it). That was *his* dharma as judged by him. So he used his body, name and image to engage in actions that fought with his detractors, shut them down and advanced his dharma. He requested Ramakrishna's other disciples in Calcutta to hold a public meeting and send news clips. Swami Abhedananda went from Dakshineshwar to Calcutta, stayed there for a few days, invited all spiritual leaders, royals and famous personalities to a public meeting, held a public meeting. He ensured that the grand public meeting was attended by many famous people and passed a formal resolution acknowledging Swami Vivekananda's contributions to Hinduism. News clips from Indian news papers were promptly mailed to the parliament of religions leaders. All doubts about Vivekananda's authenticity were laid to rest.
If Vivekananda did this out of personal egotism and to feel good about himself, he would be binding himself in more entanglements. But, he was doing it to advance his chosen dharma, which was far bigger than feeling good about himself. So it did not really bind him.
As you said, suppose your superior insults you or is unfair to you. The first instinct of a person would be to be hurt or sad or angry or mad. But, that is the sign of a overly strong self-identification with a body,
name and image. What's the big deal if someone calls me names? You, the imperishable one, are trapped in this perishable identity (body, name, image) *temporarily* just to fulfill some dharma. Identifying with this identity just enough to fulfill your dharma is required. But why identify more than needed and become angry or sad or mad that someone thinks badly about this temporary identity? It is actually quite foolish.
You should think only in terms of your dharma. What is the dharma you are working for? What things help it and what things pull it back?
Suppose you decide that one of your dharmas is to take care of your family (because there are still unpaid karmik debts). Suppose an unfair comment of a superior has a chance of impacting your next performance review, your salary or even your job itself, and, as a result, a chance of blocking your dharma. Then, the question is what action will advance your dharma better. Will you serve your dharma better by ignoring and remaining calm or by arguing back? Do whatever helps your chosen dharma more.
But, thinking "he is wrong. He is unfair to *me*" and reacting based on it useless, though that is what most people do. As I said above, do not pay too much attention to a temporary entity called your identity (body, name and image). You are not that. You are something else using 'that' to fulfill some dharma. Decide what your dharma is and base your actions in tricky situations on their impact on your dharma. Hope that clarifies a little bit.