Theocast: Work Out Your Salvation?

What does Paul mean when he wrote, "Work out your salvation?" Did he mean we were to be verifying our faith? Are we to be daily proving we are indeed of the faith? Was Paul questioning their assurance? Many who have read this verse or heard sermons preached have had their salvation question using passages like Philippians 2:12. Assurance for many is only to be found in their performance or obedience. What is the purpose of our good works? Why should we pursue good works? To confirm our salvation, or because we have already been saved?