Preheat your oven to 350°F (175°C) and prepare a greased 9-inch baking pan, lining the bottom with parchment paper.

In a medium saucepan, combine the milk, eggnog, vanilla extract, ground nutmeg, butter, 1 teaspoon of cinnamon, and a pinch of salt over medium-low heat. Stir gently for about 5 minutes, then remove from heat and let cool slightly before adding eggs.

In a separate bowl, mix the brown sugar and remaining 4 tablespoons of cinnamon until well combined.

Layer one-third of the bread cubes in the baking pan and sprinkle with one-third of the cinnamon sugar mixture. Repeat twice more, finishing with a layer of bread cubes.

Pour the custard mixture over the layered bread cubes, gently pressing down the top layer to ensure it's soaked. Save some cinnamon sugar mixture for topping.

Let the pudding rest for 10-15 minutes, then bake for 35-45 minutes until golden brown on top and slightly wobbly in the center.

While baking, prepare the eggnog sauce by whisking the granulated sugar, cornstarch, and eggnog together in a small saucepan over medium heat until thickened.

Once baked, cool for a few minutes, slice, and serve warm drizzled with eggnog sauce. Optional: top with ice cream or whipped cream.