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Just thought this deserved to be repeated:

First of all, Paul did not write that faith ALONE is what saves, but that faith apart from works of the law. So Paul does not set faith alone as the means of salvation, which would effectively remove grace as the means of salvation, if it were faith alone that saves. Specifically, Paul was insisting that it was no longer Mosaic Law that one could regard as the means of being righteous before God, which never could make one truly righteous even in OT times. His point is that it is only in Jesus Christ that we are saved. Since the time of the Reformation, many Protestants have become fixated on a slogan which is out of context, namely, that we are saved by faith alone. This is not only taking Paul out of context but is contradicted by other parts of Sacred Scripture, especially as found in the letter of James:

2:14 What does it profit, my brethren, if a man says he has faith but has not works? Can his faith save him? 2:15 If a brother or sister is ill-clad and in lack of daily food, 2:16 and one of you says to them, "Go in peace, be warmed and filled," without giving them the things needed for the body, what does it profit? 2:17 So faith by itself, if it has no works, is dead. 2:18 But some one will say, "You have faith and I have works." Show me your faith apart from your works, and I by my works will show you my faith. 2:19 You believe that God is one; you do well. Even the demons believe -- and shudder. 2:20 Do you want to be shown, you shallow man, that faith apart from works is barren? 2:21 Was not Abraham our father justified by works, when he offered his son Isaac upon the altar? 2:22 You see that faith was active along with his works, and faith was completed by works, 2:23 and the scripture was fulfilled which says, "Abraham believed God, and it was reckoned to him as righteousness"; and he was called the friend of God. 2:24 You see that a man is justified by works and not by faith alone.

St. James is teaching us that works will proceed from authentic faith, not that works themselves are the means of salvation. And so we see that the writings of St. Paul and St. James are not only compatible but complementary: faith precedes justification with God and works proceed from one who has such faith. For one who lives radically contrary to the requirements of faith, such as a life of mortal sin, we should not expect that such a one is in a state of grace. And while Father Martin Luther and others in the Reformation wanted to throw out this letter from the NT, because it contradicted their misinterpretation of Paul, they were unsuccessful. Instead, it is either overlooked or misinterpreted. Sadly, millions upon millions of Protestants since then have been misled about this Biblical truth about salvation. Faith is the beginning step which makes us open to grace but it alone is not what is established as the normative means of salvation. The Gospel of John and much of the rest of the NT vigorously assert that baptism is the formal way by which one is incorporated into the life of Christ and is given saving grace.

Finally, while we cannot agree with the statement that we are saved by faith alone, we can agree that we are saved by grace alone. For our salvation is unmerited in every way and cannot be earned by faith or works. On the other hand, for those who are in a state of grace, their works do have merit for the present and the future, as our Lord teaches in several instances as recorded in the Gospels.