Taken from "What Must I Do to Be Saved" (is just believing really enough?) article written by Dr. Reagan.
The Role of Baptism
Where does baptism fit into the picture? The same place as confession and repentance. Saving faith is always demonstrated in repentance, confession and baptism. These are not acts we perform to be saved. Instead, they are obedient responses to God in faith. As a person responds to God in saving faith, he will be compelled by the Holy Spirit to repent of his sins, to confess Jesus as Lord, and to manifest his faith through the symbolic act of baptism.
Baptism is a beautiful symbol of the death, burial and resurrection of Jesus. In like manner, it also symbolizes a death, burial and resurrection that has taken place in the life of the Believer - his death to the power and consequence of sin, the burial of his old fleshly self, and his resurrection as a new spiritual being in Christ (Rom. 6:3-8).
Some people have dismissed baptism as unimportant and therefore optional. This is a very un-Biblical attitude. Jesus commanded baptism (Matt. 28:19). The Apostles baptized all their converts and did so immediately after their confession of faith (Acts 2:38-41, Acts 8:35-38, Acts 10:43-48, and Acts 16:30-33). Peter characterized baptism as "an appeal to God for a good conscience" (I Peter 3:21).
Baptism is always portrayed as a vital step in the initial conversion process. It is the witness that the conversion process has been completed and the discipleship process is ready to begin.
Some people have seized upon baptism as the essence of salvation, and in doing so, they have converted this beautiful, symbolic act into a work to be performed in order to placate God. They argue that "you meet the blood in the water." This is known as "water regeneration."
To substantiate their position, they point primarily to two scripture texts: Acts 2:38 and I Peter 3:21. The verse in Acts is Peter's response to the people at Pentecost who reacted to his message in faith and then asked, "What shall we do?" Peter said, "Repent and be baptized in the name of Jesus Christ for the forgiveness of your sins..."
The key here, of course, is the meaning of the word "for." Does it mean "in order to obtain"? Or does it mean "because of"? In I Corinthians 15:3 we find these words: "Christ died for our sins." Does that mean He died "in order to obtain" our sins, or does it mean that He died "because of" our sins? I think it is obvious that the latter meaning is intended, and I believe the same is true in Acts 2:38.
In other words, I do not believe that Acts 2:38 presents water baptism as an act to be performed in order to obtain salvation. How could it mean that in light of what the rest of the scriptures say about salvation by grace through faith? When developing a doctrine on any topic, all scripture related to that topic must be considered and reconciled.
The other verse that is often touted in behalf of water regeneration is I Peter 3:21, which is usually misquoted to say: "Baptism now saves you." The verse does not say that. It begins with a long qualifier: "And corresponding to that, baptism now saves you..." Corresponding to what? The preceding verse says the flood of Noah.
Did the flood save Noah? Not according to Hebrews 11:6-7. Noah was saved by his faith in God. The flood washed away the evil that surrounded him, and "corresponding to that," baptism symbolizes that we have been cleansed of our sins by turning to God in faith.
The baptism that truly saves is not water baptism but the baptism of the Holy Spirit (You must be born again) that occurs when one puts his faith in Jesus as Lord and Savior. Paul refers to this baptism in I Corinthians 12:13 where he says, "By one Spirit we were all baptized into one body."