What does Baptism signify?
According to the Bible, baptism is fundamentally a physical sign of a spiritual reality, and as such functions as an identity marker to identify those who are members of the New Covenant community, that is Christ's elect people called the church.
The spiritual reality that baptism pictures is of an inward cleansing work of the Holy Spirit in the regeneration and conversion of God's elect people. As Peter explains, baptism is not merely some religious formality that removes outward dirt; no baptism for the believer reminds us that Jesus has removed our the guilt we had accrued through our sin. (1 Peter 3:21)
Baptism reminds us that of the inward cleansing and regenerating work of the Holy Spirit in conversion (Titus 3:4-7). Paul also writes in Colossians 2:11-13 that baptism is the physical representation of the spiritual circumcision of our hearts. (cf. Ezekiel 36:26-27)
The clearest picture of what baptism signifies is found in Romans 6, wherein Paul uses baptism to symbolize the believer's death and burial with Christ as their representative head, and of the believer's spiritual resurrection with Him from the symbolic grave.
Who is Baptism for?
Baptism is only for those whose hearts have been circumcised by the Holy Spirit, for those who have been regenerated by the Holy Spirit, whose guilt has been removed by Christ's death in their place, by those who have died with Christ and risen with Him in newness of life. In a nutshell, baptism is only for believers who have repented of their sin and put their faith in Jesus Christ.
Baptism is not for unbelievers, whether adult of children. As one reads the book of Acts, only those who had shown visible conversion were baptized. Baptism does not look forward to salvation, but rather it looks back upon one's salvation.
If baptism is the outward expression of an inward reality, then those who have never experienced the inner cleansing and regenerating work of the Holy Spirit are not to be baptized. Baptism is only for those who belong to Jesus' New Covenant community, which excludes unbelievers, whether adults or children.
How is Baptism performed?
Baptism is by immersion. The Greek word means not to sprinkle or pour, but to dip, dunk, or immerse. Moreover, Romans 6 pictures the descent into death with Christ as well as their ascension with Him. In the OT, judgment was often associated with being plunged into the sea (e.g. Genesis 6-9; Exodus 14-15; Jonah 1-2; Psalm 46). In fact, this is precisely what the apostle Peter draws upon when he links salvation to baptism (1 Peter 3:21).
Thus, those who have had their sins plunged into the depths of the sea (Micah 7:19), that is have had their sins judged upon Jesus by faith in Him (2 Corinthians 5:21), are to publicly declare this glorious gospel picture through their baptism by immersion.
For a more detailed, exegetical study of believer's baptism, click here.