Combine the cereal and milk in a cereal bowl. Allow to sit for 30 minutes. Strain out the milk and discard the cereal.
In a cocktail shaker, combine the cereal milk, bourbon, and vanilla extract with 3 ice cubes and shake until frothy, about 30 seconds.
Strain into a double old fashioned glass filled with ice.
Garnish with a dollop of whipped topping, a dusting of nutmeg, and sprinkle of cereal.