A putz is a real dummy or a silly fool. Your grandfather might call the taxi driver a putz if he takes him to the wrong airport.
You can use the informal putz when you need a good put-down for someone who's acted idiotically. Your cousin who starts a guinea pig circus, or your neighbor who constantly parks his car on your lawn might both be called putzes, although you might want to speak quietly if either one is familiar with Yiddish. In that language, a putz is not only a fool, but also a specific part of the male anatomy (and not the elbow).