There are four ways which people confuse the law of God and the gospel of God’s grace in Christ. Here’s a way I find helpful of knowing the truth, which sets us free.
Legalism – the separation of the law of God from the character of God and the cross of Christ.
“I am saved by being good. I know what being good is because the law of God tells me what is good. Therefore, I focus on good works and ignore Christ.”
Anti-Legalism – the separation of the law of God from the character of God and the cross of Christ.
“I am saved by God through Jesus’ death on the cross and I don’t need to keep the law. Therefore, I focus on worshipping Christ but don’t do good works.”
Neo-Legalism – the combination of the law of God with the character of God and the cross of Christ.
“I have been saved by faith in Jesus Christ AND I must do good works to show that my faith is alive. Therefore, I think less about Christ than about my own good works and am not sure if I have ever done enough good works to show that I have saving faith.”
The true gospel – the combination and separation of the law of God with the character of God and the cross of Christ.
“I have been saved from the penalty of the law by the grace of God through faith in Jesus Christ FOR good works. I cannot add anything to what Christ has done for me on the cross, therefore, I do not need to do good works to be saved. However, I know that good works flow from my knowledge of Christ. So I aim to think only about what Christ has done to save me, knowing that good works will flow from my relationship with him.”
Norfolk Island Church Of England 