Neither klutz nor putz are particularly flattering words in Yiddish, but they have different connotations. It is far better to be a klutz than a putz.
A klutz is someone who is awkward or prone to accidents. A klutz is usually unable to succeed at sports and makes frequent messes by dropping dishes or knocking items over. In modern usage, klutz is a relatively mild term that says little about a person’s character and implies the subject’s clumsiness is merely a foible. In older usage, however, it has more negative connotations, implying that someone is not only physically maladroit, but also foolish or idiotic.
By contrast, putz is a strongly impolite and negative term for someone who is foolish and inept and, most likely, a jerk. In American usage, it also means penis, making it similar to the Yiddish word shmuck and the slang usage of the English word tool. For example: “This putz cuts the line at Zabar’s like he owns the place. Unbelievable.”
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