Melt the butter in a large saucepan, as the caramel will increase significantly in volume while cooking. Once the butter has melted, add the sugar. Stir occasionally until the sugar has completely melted and combined with the butter.

Add the heavy cream and keep stirring until the mixture becomes smooth. This can take a while, but it will come together.

Once the caramel starts to boil, let it boil for about 5 minutes while stirring constantly. Only start timing once you see plenty of bubbles forming in the pan.

After cooking, add the vanilla extract and stir well before pouring the caramel sauce into a jar.

Keep in mind that cooking times may vary depending on the pan and stovetop. I personally stop cooking when the sauce is still just slightly thinner than I want it to be, because the caramel sauce will thicken a bit more as it cools.