This statement goes back to the life of Abraham as recorded in Genesis 15:6. Moses says it was counted for righteousness. The religious world has a “field day” on this passage. They come to Romans 4:3 and they state if a man tries to save himself by works, he discards the idea of grace. They move quickly to say that baptism is a work. Hence you cannot be saved by being baptized. Break down the statement in the book of Genesis. Abraham believed in God (Genesis 15:6). If God declares by such a belief that a man is righteous, then the religious world asserts, that one can never lose that.
Let us try this out. Abraham and God are discussing the same subject two chapters later. What do we find Abraham doing in chapter 17:17? He was on his face laughing and said in his heart the following: “Shall a child be born unto him that is an hundred years old? And shall Sarah, that is ninety years old, bear?” Back in chapter 15, God tells Abraham that he and Sarah would have a child. Abraham believes what God says and it was counted to him for righteousness. When God states the same thing again in chapter 17, Abraham is laughing. Does this sound like a man who believes in what God said? Being declared righteous is not a one time thing as the life of Abraham shows. One must continue to be righteous as per chapter 17.
The meaning from Romans 4 is that when a person’s sins are forgiven, God declares the person to be righteous. It is now up to the person to continue to live a righteous life. The example used by James was that when Abraham offered up Isaac, God declared him to be righteous (James 2:23). God says Abraham was righteous in Genesis 15 and then it states that God declared him righteous in chapter 22. Both events signal the same idea. Obeying God places one in a right relationship with God. One must continue to live righteous as shown in Genesis 22. (Titus 2:12).