We focus on accessing the economic viability of various sanitation interventions through a cost–benefit analysis in the Mahalaxmi municipality of Nepal. The lack of affordable sewer-based sanitation systems in low- and middle-income countries poses a challenge to achieving Sustainable Development Goal 6.2 (safe sanitation). We examine three sanitation scenarios: 100% sewered sanitation, 100% non-sewered sanitation, and a hybrid scenario that combines both. We consider the perspectives of residents, the private sector, and the government. Estimated life-cycle costs, benefits (primarily reduced mortality and morbidity), and stakeholder roles are analyzed. The results provide evidence-based insights that facilitate decision-making for sanitation interventions in similar contexts. However, limitations include a focus solely on health benefits and a lack of detailed data on other potential benefits.