In a sauce pan, add butter, sugar, water, and salt. Heat over medium heat.
Melt butter and then bring to a boil. Boil for 5 minutes while stirring.
Remove from the heat and mix in the milk and vanilla. Store in an air tight container in the refrigerator for up to 7 days.
Notes
You can keep it in the freezer for up to 3 months. Just don't place it in a glass container. Place it in a plastic container and give it enough room to expand when it freezer. If you fill a glass container, it can break if the caramel expands too much when frozen.