Michael Horton has a very helpful article on this most important doctrine.
Nevertheless, there is a subjective aspect to our union with Christ which receives equal attention in Scripture and, therefore, commands equal attention from us. Calvin wrote, “We must understand that as long as Christ remains outside of us, and we are separated from him, all that he has suffered and done for the salvation of the human race remains useless and of no value for us….All that he possesses is nothing to us until we grow into one body with him” (Institutes, III.i.1).
All of our righteousness, holiness, redemption, and blessing is found outside of us–in the person and work of Christ. This was the declaration of the Scriptures and, following the sacred text, of the reformers, in the face of a subjective righteousness located in the believer. And yet, as Calvin points out, this “alien righteousness” belonging to someone outside of us would mean nothing if this righteous one remained forever outside of us. An illustration might help at this point. In my junior year of college, I went to Europe with some friends and ran out of money. Happily, my parents agreed to deposit enough money in my account to cover my expenses. Was that now my money? I had not earned it. I had not worked for it. It was not my money in the sense that I had done something to obtain it. But it was in my account now and I could consider it my own property.
While none of our righteousness is our own, Christ is! While none of our holiness belongs to us, properly speaking, Christ does!The devils know Christ is righteous, but they do not, cannot, believe that he is their righteousness.
It is essential, therefore, to point unbelievers and believers alike to Christ outside of their own subjective experiences and actions, but that is only half the story! The Christ who has done everything necessary for our salvation in history outside of us now comes to indwell us in the person of his Holy Spirit. “God has chosen to make known among the Gentiles the glorious riches of this mystery, which is Christ in you, the hope of glory” (Col.1:27). While our assurance is rooted in the objective work of Christ for us, it is also true that “We know that we live in him and he in us, because he has given us of his Spirit” (1 Jn.4:13).
Thus, this doctrine is the wheel which unites the spokes of salvation and keeps them in proper perspective.
This doctrine is another way of saying, “Christ alone!” All spiritual blessings in heavenly places are found in him. Even the gifts of the Holy Spirit are through and for the ministry of Christ the Mediator. No one is baptized in the Holy Spirit, but baptized by the Holy Spirit into Christ.
You read the entire article HERE.