In a medium-sized mixing bowl, whisk together the egg yolks and granulated sugar until the mixture is pale yellow and slightly fluffy. This step incorporates air and helps the sugar dissolve into the yolks.
In a saucepan over medium heat, combine the whole milk, heavy cream, ground nutmeg, and a pinch of salt. Stir occasionally until the mixture reaches a simmer, but do not let it come to a full boil.
Slowly pour about half a cup of the hot milk mixture into the egg yolk mixture while whisking constantly. This “tempering” process raises the temperature of the eggs slowly so they do not scramble when added to the hot liquid.
Pour the tempered egg mixture back into the saucepan with the remaining hot milk. Cook over low heat, stirring constantly with a wooden spoon or spatula, until the mixture thickens slightly and coats the back of the spoon. This usually takes about 5 to 8 minutes.
Remove the pan from the heat and stir in the vanilla extract and your choice of alcohol, if using. Pour the eggnog through a fine-mesh strainer into a pitcher to ensure it is perfectly smooth. Cover and refrigerate for at least 3 hours, or ideally overnight, to let the flavors develop.