We lead with the words of Canon 1171 which, speaking about reverence in handling Sacred objects:
“Sacred objects, set aside for divine worship by dedication or blessing, are to be treated with reverence. They are not to be made over to secular or inappropriate use, even though they may belong to private persons.”
This law doesn’t look like it is also speaking of the Rosary, but mainly liturgical objects like vestments, chalices etc. However, it covers every sacramental by extension since these are also sacred objects and should be accorded reverence in their use. At least they should not be used for profane or purposes opposed to Catholic piety.
Talking about wearing them: there are many sacramentals made to be worn around the neck or on the wrist as a bracelet. The Saint Louis de Montfort in his book “Secret of the Rosary” actually encourages the wearing of the Rosary. He told a beautiful story in the book:
Alphonsus, King of Leon and Galicia, very much wanted all his servants to honour the Blessed Virgin by saying the Rosary. So he used to hang a large rosary on his belt and always wore it, but unfortunately never said it himself. Nevertheless his wearing it encouraged his courtiers to say the Rosary very devoutly.
One day the King fell seriously ill and when he was given up for dead he found himself, in a vision, before the judgment seat of Our Lord. Many devils were there accusing him of all the sins he had committed and Our Lord as Sovereign Judge was just about to condemn him to hell when Our Lady appeared to intercede for him. She called for a pair of scales and had his sins placed in one of the balances whereas she put the rosary that he had always worn on the other scale, together with all the Rosaries that had been said because of his example. It was found that the Rosaries weighed more than his sins.
Looking at him with great kindness Our Lady said: “As a reward for this little honor that you paid me in wearing my Rosary, I have obtained a great grace for you from my Son. Your life will be spared for a few more years. See that you spend these years wisely, and do penance.”
When the King regained consciousness he cried out: “Blessed be the Rosary of the Most Holy Virgin Mary, by which I have been delivered from eternal damnation!”
After he had recovered his health he spent the rest of his life in spreading devotion to the Holy Rosary and said it faithfully every day.
People who love the Blessed Virgin out to follow the example of King Alphonsus and that of the saints whom I have mentioned so that they too may win other souls for the Confraternity of the Holy Rosary. They will then receive great graces on earth and eternal life later on. “They that explain me shall have life everlasting life.”
So, as long as one isn’t misusing sacred objects it is okay to wear it in the neck. We are encouraged to surround ourselves with sacred things and items that point to or remind us of God.
“So whether you eat or drink, or whatever you do, do everything for the glory of God” (1 Corinthians 10:31).
However if one is wearing the Rosary only as a piece of jewellery then this could be a problem since it would be reducing a sacred object to a mere beauty-piece. It devalues the spiritual significance of the sacramental itself and this isn’t good.
There’s need also to check the cultural significance of the place where a person lives. If wearing the rosary means identifying with some anti-catholic belief or statement, then one has to be careful not to be approving these messages. I have heard that there are even some gangs who put on the rosary as a statement. This is terrible. And in a country or city where this is rampant, one should be contented with selecting another sacramental for the neck in order not to scandalize others.
It is not bad in itself to put on the Rosary around the neck as long as one does so with reverence and uses the rosary as a sacramental. Even if it beautifies the person, it should also be held with the reverence for which it is intended.