Real vanilla extract is about $10 for 4 oz on average. It lasts awhile unless you bake alot, but still, it's not cheap. Handmade extract is supposed to taste better and be more flavorful. (Though I can't comment on that aspect yet cause mine isn't done.) Plus it's cheaper. I paid just under $4 per bottle for mine and each one is around 9 oz. The bottles were under $2 a piece making it around $5.50 total each.
You need real vanilla beans and 80 proof vodka. Slit the beans down the center with a knife, put them in your jar (2-3 per jar depending on size) and cover with vodka. Let them sit in a cool dark place for a couple months shaking them every few days. That's it.
This is only a couple days after I made mine and you can see it turning darker already.
I have 12 bottles steeping in my closet. It's pretty neat to watch them changing color as time goes on. I've read that you can reuse the beans at least once as well. I may throw an additional bean in there when I refill one just to make sure it's still strong.
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