Preheat oven to 350 F. Line a 12 cup muffin pan with cupcake liners. In a large bowl, whisk together flour, sugar, baking powder and salt.
Add in eggs, milk, vegetable oil and vanilla extract until smooth. Fold in lucky charms cereal. Evenly divide cupcake batter between the lined muffin pan and bake for 15-18 minutes. Let cool completely.
In a large bowl, beat softened butter with powdered sugar, milk and vanilla extract until smooth. Pipe frosting onto cupcakes and garnish with lucky charms cereal.