It is always a difficult time when you find that you are earning 99c but regularly spending $1.00. If you cannot turn the position around, personal bankruptcy being declared against you looms as a real consequence.
Filing for bankruptcy itself is the most serious alternative when you are in financial difficulties, and the whole situation is stressful, so sharing the problem with your lawyer in the first instance can help clarify the best way forward.
The general consequences are significant. In brief, any proceedings commenced against you to recover debts are halted, and some are actually cancelled. However, the personal cost is high. Certain debts will still remain payable, and any assets you had recently transferred within a two year window may be able to be clawed back from the recipient.
While you are able to retain essential personal items, the remainder is sold. Your credit rating will be affected, and you cannot buy or own significant assets for a period of three years. After this three year period you are able to be discharged from the bankruptcy.
The office of the Official Assignee can be approached directly regarding your bankruptcy, but there is no downside to asking your lawyer first to review the options with you.