Roman Catholics Christians reject the concept of faith alone (ie that we are justified solely by our faith in Jesus Christ) and that we are justified by both our faiths and our works, but how do they interpret Ephesians 2:8-9 which clearly teaches faith alone?

For by grace are ye saved through faith; and that not of yourselves: it is the gift of God:

Not of works, lest any man should boast.

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In Catholicism, there is initial justification which is by grace only and there are also progressive and final justification. See two Jimmy Akin EWTN articles:

Notice that Eph 2:8-9 is in past tense referring to initial justification. During progressive justification (which in Catholic understanding is an ontological righteousness we possess incrementally IN ADDITION TO the initial justification which is discrete, one-time, 100% grace, and "legal"), believers still need to cooperate with the Holy Spirit until death instead of quitting mid-way (see warnings in Heb 4:1, 1 Cor 10:12, Rom 11:21-22), resulting in fruits of faith (aka "good works", cf James 2:14-26) done in a state of grace, enabled by the grace given by the Holy Spirit who lives inside believers.

Catholic Answers article Faith and Works: Understanding Ephesians 2:8-9 article by Jimmy Akin points out the subsequent verses Eph 2:10 which brings in the good works we need to do for progressive / final justification:

The sense of what Paul is saying is: “God has raised up both of us—Jews and Gentiles—to sit in the heavenly places in Christ Jesus, for we received initial salvation as a gift. We obtained it by faith in Christ (which itself is a gift from God), not by works of obedience to the Mosaic Law. So neither Jew or Gentile can boast over the other of having privilege with God. “Instead, we Christians are the result of God’s work, for he created us anew in the body of Christ so that we might do good works-the kind of works we should be concerned about-for God intended ahead of time for us to do them” (paraphrase of Eph. 2:6-10)

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    Where do they derive the notion that the good works are meritorious in progressive and final justification rather than flow from it initially? Commented Dec 17, 2022 at 13:36
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    @MikeBorden While thinking about how to answer your question, I realized that you phrased the question carefully and it's harder to answer than I thought. So I'm going to use it for a new question unless it has already been asked. Commented Dec 17, 2022 at 14:39
  • @GratefulDisciple I noticed you quoted Phil 2:12 and said, "Believers still need to "work out their salvation." The verse is "NOT" teaching to work out salvation to "get saved or to stay saved." The Philippians are already believers in Christ. The context starting at vs2 is the believers are being selfish, conceited and not putting others first. Paul explains that Christ (as our example and who is God, vs5-6) died on the cross for the benefit of the human race. Vs12, Paul is saying to work out the "deliverance/salvation of your problems," and quit grumbling because God is in you, vs13-14.
    – Mr. Bond
    Commented Dec 17, 2022 at 15:33
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    @MikeBorden When I read the first Jimmy Akin's article, I think Chapter X ("The Increase of the Justification Received") of Trent Decree on Justification has the Biblical basis (Rom 6:13,19, James 2:24, etc) that our cooperation with the Spirit resulting in good works will increase our holiness (esp. Rom 6:19b). Of course some Protestants who do not believe in ontological / actual righteousness will object. Commented Dec 20, 2022 at 18:18
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    @MikeBorden As I read the Catholic doctrine in more detail, it's clear that you need initial justification FIRST, otherwise the good work is not meritorious and does not result in the increase of righteousness. Also, supernatural charity (given by the Holy Spirit living in us) needs to be the first principle (grace) of the act. But unless we have the Holy Spirit living in us, we don't have initial justification, so therefore we can that the good works "flow from initial justification". Commented Dec 20, 2022 at 18:58

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