Prepare the Cake
Preheat oven to 375°F (190°C).
Grease or line a 9×9-inch baking dish with parchment paper.
In a large mixing bowl, beat the egg.
Add sugar, milk, salt, oil, and vanilla extract. Mix until combined.
Add flour to the bowl and sprinkle baking powder over the flour.
Gently mix the baking powder into the flour before stirring everything together until just combined.
Pour the batter into the prepared baking dish and spread evenly.
Make the Streusel
In a microwave-safe bowl, melt the butter.
Stir in brown sugar, cinnamon, and flour until well combined.
Mix in chopped walnuts if using.
Sprinkle the streusel mixture evenly over the cake batter.
Using your finger or the handle of a wooden spoon, poke the streusel halfway into the batter about 12–18 times to create pockets of cinnamon flavor.
Bake
Bake for 25–30 minutes, or until a toothpick inserted into the center comes out with moist crumbs attached.
Do not overbake, as the cake may become dry.
Allow the cake to cool slightly before icing.
Optional Vanilla Icing
In a small bowl, mix softened butter and powdered sugar.
Add milk gradually until the icing reaches your desired consistency.
Lightly drizzle the icing over the warm or cooled coffee cake.