Schmuck means jewelry, in this context. It can mean decoration, eg. at Christmas, but primarily jewelry. Putz means decoration, accessories, also jewelry, stuff like that - imagine a rococo lady. She wears Putz. I only wear Schmuck.

I knew schmuck was a yiddish expression, and thought my deal about it but I did not know what it was referring to exactly.

hehe - there's also the "family jewels" - perhaps it has something to do with that. Makes sense anyway.