Preheat your oven to 350°F and spray a 9x13 baking dish lightly with cooking spray. Cut the day-old croissants into 1-inch cubes—day-old croissants work best here because they're slightly drier and will absorb the custard more effectively than fresh ones. Spread the croissant cubes evenly in the prepared baking dish.

In a medium bowl, whisk together the 3 room temperature eggs until well combined. Add 2 cups of eggnog, 1/4 cup sugar, 1 tsp vanilla extract, 1/2 tsp rum extract, and 1/8 tsp freshly grated nutmeg, whisking until smooth and fully incorporated. I prefer freshly grated nutmeg here because it has a more vibrant, aromatic quality than pre-ground—it really makes a difference in the final flavor.

Pour the custard mixture from Step 2 over the croissant cubes in the baking dish, making sure to coat everything evenly. Gently press down on the croissants with the back of a spoon to help them absorb the custard, then let the mixture sit for 10 minutes to allow proper soaking. This resting period is crucial—it ensures the bread pudding will have a custardy, rich interior rather than a dry, bread-like texture. After soaking, place the baking dish in the preheated 350°F oven and bake for 30-35 minutes until the custard is set but still slightly jiggly in the center.

While the bread pudding bakes, melt 1/2 cup unsalted butter in a heavy-bottomed saucepan over medium heat. Add 1/2 cup sugar and stir constantly for 6-8 minutes, watching as the mixture transforms into a golden caramel—you want it to smell rich and nutty but not burnt. The constant stirring prevents the sugar from crystallizing and ensures an even caramel. Once you reach that golden stage, carefully whisk in 3/4 cup eggnog (it will bubble up, so be cautious), then let it come to a gentle boil for 1-2 minutes while stirring.

Remove the saucepan from the heat and immediately whisk in 1 tsp baking soda—this will cause the sauce to bubble and foam slightly, which is normal and creates a lighter, airier sauce with added richness. Let the sauce cool for a few minutes before serving; it will thicken slightly as it cools. I love how the baking soda transforms the texture—it adds a subtle depth that you wouldn't get from caramel alone.

Remove the bread pudding from the oven when it's set and lightly golden on top. Divide into serving portions while still warm, then drizzle generously with the eggnog caramel sauce from Step 5. Serve immediately for the best texture—the warm bread pudding pairs beautifully with the rich, creamy sauce.