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"I had been planning to roll it over into an existing Roth IRA at TIAA-CREF. They told me the conversion will require me to pay taxes on the amount as regular income, but there is no penalty."

There may be a confusion of terms here. There is no tax or penalty for a direct rollover from SIMPLE to traditional IRA, when you've held that particular SIMPLE IRA for at least 2 years. However, you use the word 'conversion', which the custodian may have heard to be a Roth conversion, for which there would be no penalty yet the conversion would be includable by you as ordinary income for that year.

"But I also have about $5200 of debt on one of my credit cards. It occurred to me to instead take an early withdrawal and use the proceeds to pay off the credit card."

Yes, you could do that. But there would be a 10% penalty (assuming you are not yet 59.5) and it would be reportable as income. But equally important, you'd be robbing from your retirement piggy bank to pay for current debt. Yes, it is good not to be carrying debt...particularly debt of the high interest type. But you'd be better served to gradually pay off the debt and NOT to incur any more, while leaving your retirement piggy bank alone.

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