401K or rental portfolio?

[Jon Klaus]

Hypothetically, which would you rather have?

A 401K worth $500,000, currently invested in index funds, but easy to convert to other securities or cash. 

Or

10 single family homes worth $1,000,000 with $700k worth of mortgages, 8% yield, and $25,000 per year of cash flow.  Paying down the mortgages at a $20,000 per year clip, but that is increasing yearly as the mortgages mature.  On average, 20 years left on the mortgages.  You self manage the properties.  

Which one do you choose, and what's your investment plan going forward?