In a 3-quart heavy-bottomed saucepan, combine the sugar and water.
Stir lightly to ensure the mixture forms an even layer.
Cook the Sugar:
Place the saucepan over medium heat.
Cook the mixture, stirring occasionally, until the sugar dissolves and the liquid turns clear (about 3-4 minutes).
Once it starts bubbling, avoid stirring. Instead, swirl the pan gently and brush down any sugar crystals from the sides.
Watch for the Amber Color:
As the sugar clumps, continue swirling the pan.
Cook until the mixture turns a deep amber color, similar to honey (around 8-12 minutes).
Keep a close eye on it to prevent burning.
Add the Butter:
Carefully drop in the butter and whisk constantly until fully melted.
Be cautious, as the caramel will bubble up rapidly.
Incorporate the Cream:
Remove the pan from heat.
Slowly pour in the cream, whisking continuously until fully mixed in.
Flavor and Cool:
Stir in the vanilla and a pinch of salt (if using).
Let the caramel cool in the pan for about 10 minutes.
Store:
Once cooled slightly, transfer the caramel into a glass jar with a lid.
Allow it to cool completely. The sauce will thicken as it cools.
Storage: Keep the caramel sauce in the fridge for up to 3 weeks, or freeze for up to 2 months. If refrigerated, the caramel will solidify, so reheat it in the microwave to return it to your desired consistency.